Score=90% BT Conferencing Acquires Wire One

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BTConferencing is one of the four strategic operating units of BT Group. BT Conferencing was first established in 2001 and has evolved into a leading global provider of audio, video and web collaboration services. BT Conferencing is the largest conferencing provider in the UK and Europe with reach extending across more than 55 countries.

With operations centered in the USA, western Europe and Asia Pacific, BT Conferencing specializes in the delivery of reliable, robust and innovative conferencing solutions to some of the largest companies in the world including 80% of the Financial Times 100 and 20 of the Fortune 50 companies. BT Conferencing coordinates 40% of the investor relations calls for the Fortune 500 companies.

BT Conferencing provides rooms for public use, telepresence concierge services, reservation services, network operations services and through BT Global Services, bandwidth as required. With a Video Operations Center in both the USA and UK, BT Conferencing managers more than 3,000 endpoints in the UK with responsibility for remote diagnostics and technician dispatch.

The acquisition of Wire One for an undisclosed sum (1997 assets of $90 million), HQ in Denver Colorado, 8000 customers and 350 employees around the USA,  

Strategic fit [5/5].

BTConferencing is a global operation, but the USA is the most well-developed and highest density market for high definition and telepresence services. This deal greatly strengthens its USA operations, adding significant customer weight (55% of Fortune 100) and staff. Both companies share strategic relationships with Cisco, RADVISION and TANDBERG.

Timing [5/5].

With all the hype about private equity drying up, here's a private equity group divesting an enterprise.

Video conferencing is a rapidly growing segment of the conferencing market. In light of the troubles of the US business travel market - rising fuel costs, rising hotel costs, and increasing travel disruptions - and the attendant business disruptions as a result of travel problems. Gaining bulk in the important USA market means that BT Conferencing is positioning itself in advance of market growth.

Customer demand [4/5].

Even though it is entirely possible (and likely) that BT Conferencing and Wire One share major customers, there will be opportunities to bring BT Conferencing capabilities to Wire One customers and similarly bring Wire One capabilities to BT Conferencing customers. Acquiring customer relationships is (like Oracle figured out) cheaper to do than fighting to win them the old fashioned way. 

Potential [4/5].

This combination has the potential to keep BT Conferencing growing, and earns them a larger stake in the most mature and highest density video conferencing market, especially as the audio conferencing minutes decline. 

Overall: 18/20 = 90%. 

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