PSINet Inc, the business ISP has made its first acquisition in Chile and added another ISP in Argentina, bringing the total cost of its acquisitions to about $100m in just over 12 months. Terms were not disclosed beyond the fact that they were cash deals.
The Herndon, Virginia-based company is intent on building and acquiring its own worldwide backbone and has acquired Netline Communicaciones SA, which is said by IDC to be the third-largest ISP in Chile, marking the company’s first move into that country’s market. Netline has about 12,000 subscribers, about 60% of which are end users and the rest are commercial users. PSINet intends to retain the dial-up customers because, says Philippe Kuperman, president of PSINet Latin America, many of them are small businesses just getting on to the net with their first dial-up connection and represent prime upgrade opportunities for the company.
The Argentinean company, Netsystem, based in Buenos Aires, is not an ISP, but a networking systems integrator. It has about 400 customers, mainly in the Argentinean banking, manufacturing and telephone and energy industries and PSINet intends to offer its services through Latin America over time. PSINet entered the Argentinean ISP market in July with the acquisition of Argentina On-Line. The country is on its hit list of the top 20 telecommunications markets in the world in which it intends to have a presence.
The founder of Netsystems, Enrique Draier becomes general manager of the Southern Cone region of PSINet’s operations. PSINet divides its Latin American businesses into three areas: Mexico and Central America; Brazil; and the Southern Cone comprising Argentina, Bolivia, Chile, Paraguay, Peru and Uruguay. The heads of each sub-region report to Kuperman.
