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September 14, 2010

Paetec to acquire Cavalier Telephone for $460m

To extend its existing footprint and reduce overall expenses

By CBR Staff Writer

Paetec Holding, a provider of IP, voice, data and Internet services, has signed an agreement to acquire telecommunications offerings provider Cavalier Telephone for $460m.

Under the terms of agreement, Cavalier, whose majority owner is M/C Venture Partners, a private equity firm based in Boston, will become an indirect wholly-owned subsidiary of Paetec.

With the acquisition, Paetec will be able to add around 17,000 fiber-route miles to its existing service footprint, allowing it to offer an alternative for last-mile connectivity to customers and reduce overall expenses through improved cost-structures and network grooming.

Paetec chairman and CEO Arunas Chesonis said that this acquisition of Cavalier fits the company’s strategic plan to add both fiber assets and regional density to better serve its customers and realise increased network synergies, both in local loop and long haul.

Both the companies expect to close this transaction within four to six months.

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