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October 15, 2010

Broadvox, Cypress, Leading VoIP and Unified Communication Providers, Announce Merger

By Ed Silverstein, TMCnet Contributor

Broadvox (News - Alert), a well-known VoIP provider, is acquiring Cypress Communications, a unified communication service provider, under a merger agreement that is expected to close within a few months.

The two companies expect to realize many benefits as will their customers through the synergy achieved with the merger.

Details of the merger were not made public.

It’s undecided what the name and structure of the new entity will be coming out of the merger. There is value in both names, a company spokesman said.

There are no plans to close offices nor are there any immediate plans to downsize staff. There is not a lot of overlap between what the two companies do.

The merger is expected to become final after state and federal approvals, which should take between 60 and 90 days.

From an industry perspective, Cypress has had a focus on retail and UC, with a large retail customer base.

Broadvox has a focus on its large interconnected VoIP network.

Through the merger, Cypress will gain access to Broadvox’s network backbone for direct origination and termination of voice traffic to more effectively meet the needs of its expanding customer base.

Broadvox will benefit from the increased utilization of its network backbone and the ability to enhance its carrier, SMB and SME offerings with the Cypress Communications’ (News - Alert) unified communications suite of services.

Basically, both companies will benefit from each other’s respective strengths.

In addition, in the VoIP world, scale and size matter. There are more customers, more stable financing and continual investing, with the combined companies.

“Consolidation is healthy for the industry and healthy for us and healthy for our customers,” Frank Grillo (News - Alert), executive vice president of Implementation, Support and Marketing at Cypress Communications, said in a phone interview Friday with TMCnet.

While both companies deliver a hosted VoIP and hosted unified communications solution, neither customer base is expected to be affected by the merger. Customers using Cypress’ C4 IP product and those using Broadvox’s GO!VBX will see no changes in their current feature sets, phones, or technology platforms. The Cypress C4 IP solution is suited for enterprises, while GO!VBX primarily targets SMBs.

The Breckenridge Group, Inc. and Iridius Capital Group acted as financial advisors in the transaction, and King and Spalding and Calfee, Halter & Griswold LLP acted as legal advisors.

Founded in 2001, Broadvox is a global leader in providing integrated and managed VoIP services to SMB, enterprise, and carrier customers. It deployed one of the largest, full-featured, global VoIP networks, and works with 300 telecommunications carriers, ASPs, ISPs, and over 3,500 businesses which transport more than 12 billion minutes annually.

Broadvox offers SIP Trunking, SIP origination and termination services, and hosted communications solutions. Broadvox is headquartered in Dallas, Texas. For over 25 years, Cypress Communications has been giving small-to-medium enterprises (SMEs) a range of fully hosted and managed voice, data and Internet solutions. Beginning in 2006, Cypress changed the communications industry with its hosted VoIP and hosted unified communications solution, C4 IP, making it easier for SMEs to take advantage of productivity-enhancing technology, such as integrated audio and web conferencing, multimedia collaboration tools, presence, chat, and Microsoft (News - Alert) Outlook integration.

Ed Silverstein is a TMCnet contributor. To read more of his articles, please visit his columnist page.

Edited by Juliana Kenny

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