MegaPath to Merge Certain Assets with Global Capacity through Buyout Agreement

MSP and cloud services provider MegaPath (News - Alert) Corporation is cashing in on its success and fine-tuning its business model. The company announced an agreement to sell its wholesale business and national colocation aggregation network to private equity firm Pivotal Group, which will merge the assets with Global Capacity (News - Alert), a wholly owned company in its portfolio.

Global Capacity provides connectivity as a service, and the merger will add more than 400 new wholesale customers to its roster. The deal will also give MegaPath much needed financing to build out its managed and cloud services geared toward SMB and enterprise customers. The company will be exclusively focused on its voice, MPLS and security networks as well as value-added managed and cloud services.

“Today’s deal creates a more focused MegaPath, with increased access to capital to fund our strategic, high-growth, value-added services,” said D. Craig Young, executive Chairman of MegaPath. “MegaPath now has a greater capability to invest in a product growth strategy to meet the needs of our customers and partners.”

MegaPath has steadily been building out its value-added services, including VoIP and unified communications (UC) solutions. The company officially rolled out its new UC service at the end of last month, providing IP voice capabilities and a variety of collaboration features. The service is being delivered as an add-on to the MegaPath Hosted Voice service, providing a total of more than 50 calling and mobility features.

The merger with Global Capacity will boost the company’s One Marketplace, which combines an interconnected, aggregated network with a cloud application for simplifying the procurement of network solutions. The marketplace also aims to streamline service delivery by providing a single interface for the design, pricing and fulfillment of multi-network and multi-geography architectures.

The buyout and merger are expected to close by the end of the year. MegaPath will remain a privately held company in the deal.