BOSTON (03/22/2000) - Internet service provider PSINet Inc. today said it has signed a definitive agreement to acquire IT services provider Metamor Worldwide Inc. in an all-stock transaction valued at approximately US$1.9 billion.
Under the terms of the agreement, each share of Metamor will be exchanged for 0.9 shares of PSINet common stock, according to PSINet.
Texas-based Metamor has 4,500 employees in 70 offices in the U.S., Europe, India, Asia and Australia, according to Metamor officials speaking on a conference call today. In 1999, the company saw revenue of $577 million, they said.
Metamor will be integrated into PSINet, which will strengthen PSINet's ability to provide turnkey outsourced services, which range from Web design to managed hosting, according to William Schrader, PSINet's chairman and chief operating officer.
Given PSINet's customer base of 90,000, the integration of Metamor into PSINet will provide many new cross-selling opportunities, Schrader said. Only 5 percent of PSINet's customers are "truly Web centric," so the rest are solid candidates for Metamor's services, he said.
Metamor consists of four business units and one subsidiary, according to the company:
-- The company's Enterprise Solutions unit is focused on enterprise services, including packaged software offerings, customer relationship management, supply chain management and training and educational services using SAP AG, PeopleSoft Inc., Oracle Corp. and Baan Co. NV.
-- Metamor's European Solutions unit provides IT consulting and services, including systems design, document and information management and scientific, technical and industrial design. The unit has operations in France, Germany, Switzerland and the U.K.
-- Through its technology centers in the U.S. and India, its Global Solutions unit offers 24-hour onsite and offsite systems maintenance, application development, systems integration and repeatable code generation services.
-- The Industry Solutions unit aims to deliver applications to specific industries, especially telecommunications, financial services and government.
The deal also gives PSINet a controlling interest in Metamor's e-business solutions subsidiary, Xpedior Inc., and PSINet will invest $50 million in Xpedior, according to PSINet.
The acquisition, which still needs to be approved by both companies' shareholders, is expected to close mid-year, officials said.
PSINet, in Herndon, Virginia, can be reached at +1-703-904-4100 or at http://www.psinet.com/.