Cable & Wireless to acquire PSINet Japan

Cable & Wireless PLC has agreed to purchase PSINet Japan, the Japanese unit of bankrupt Internet service provider PSINet Inc., the companies announced Monday.

C&W will acquire PSINet Japan via its local affiliate, Cable & Wireless IDC, for 7.2 million pounds (US$10.3 million), it said in a statement.

With the acquisition of PSINet, C&W said its position in the IP (Internet protocol) market is expected to strengthen and its revenue from such services double. In the first half of this year, revenue from IP services was 28 million pounds, it said.

C&W became a major player in the Japanese telecommunication industry when it launched and won a takeover bid for long-distance and data carrier International Digital Communications Inc. (IDC) in 1999. PSINet Japan also built itself up through a series of acquisitions including Tokyo Internet Corp., a major consumer and business Internet service provider in the Japanese capital.

The sale is the latest in a string of transactions effected this year by PSINet, which filed for Chapter 11 bankruptcy, along with 24 of its U.S. subsidiaries, on June 1 this year. The company has also sold or agreed to sell its Canadian operations to Telus Corp., its U.S. DSL (digital subscriber line) subscribers to CAIS Internet Inc., its Panamanian operations to REE Panama SA and a group of Latin American operations to investment group Cori Capital Partners LP. Elsewhere in Asia, the company recently announced a deal to sell its Hong Kong operations to a unit of local conglomerate CITIC Pacific Ltd.

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