GTS Acquires Rest of Euro 'Net Backbone Ebone

U.S.-based telecommunications company Global TeleSystems Group Inc. today said it has acquired the remaining 25 percent of Ebone A/S, a European Internet backbone provider of which it bought 75 percent last year.

The move is meant to boost GTS's global Internet profile, the company said. Having full control of Ebone will strengthen GTS's offerings for ISPs (Internet service providers), such as web-hosting for online and e-commerce companies and IP (Internet protocol) communications services for businesses, the company said.

GTS acquired the remaining shares from Ebone Holding Association, an association of ISPs that owned the company. Ebone, established in 1996, has headquarters in Copenhagen and serves ISPs in 25 countries.

The company also announced it will develop CLECs (competitive local exchange carriers) in Paris, Geneva and Berlin, with plans to develop at least 12 CLECs in Western Europe by the end of 2001.

GTS has five primary lines of business:

-- GTS Carrier Services provides cross-border transport in Europe to other telecommunications companies; -- GTS Access Services provides facilities-based access services to businesses throughout Europe; -- GTS Business Services -- Western Europe offers voice, data, Internet and other telecommunications services to businesses; -- GTS Business Services -- Commonwealth of Independent States (CIS) provides telecommunications services in Moscow, Kiev, St. Petersburg and other cities in Russia and the CIS; and -- GTS Mobile Services -- CIS operates cellular businesses in Russia and Ukraine.

In February, GTS expanded its electronic commerce, Web-design and Web hosting services in Central Europe by acquiring two ISPs and majority shares in two other ISPs in that region. It spent US$19.5 million [M] to acquire DataNet in Hungary and NetForce in the Czech Republic, and bought majority stakes in two Polish ISPs, Internet Technologies and ATOM SA, giving it access to more than 3,000 business customers in Poland. [See "U.S.-Based GTS Expands in Central Europe," Feb. 16.]In January, GTS and Flag Telecom announced a joint venture to build and operate what they said was the first terabit transoceanic system. [See "First Terabyte Transoceanic Cable Underway," Jan. 14.] The $1 billion [B] system will be designed to carry voice, data and video traffic at up to 1.28 terabits per second between Europe and the U.S., with service to begin in 2000 for a direct link between New York, London and Paris, GTS said.

GTS had a 1998 net loss of $152.6 million [M] on consolidated annual revenues of $197.5 million [M].

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