Primus Acquires Magma for $16 Million Published: Apr 20, 2004

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Primus Telecommunications Group (primustel.com), announced on Monday that its wholly owned Canadian subsidiary Primus Telecommunications Canada (primustel.ca), has acquired Magma Communications (magma.ca).

April 19, 2004  -- Primus Telecommunications Group (primustel.com), announced on Monday that its wholly owned Canadian subsidiary Primus Telecommunications Canada (primustel.ca), has acquired Magma Communications (magma.ca). Magma is a provider of Internet solutions to the Toronto, Montreal and Ottawa markets. Its services include Web hosting, colocation, managed services and Internet access.

Primus will acquire 100 percent of the issued stock of Magma for approximately $16 million (Canadian), half of which will be paid in cash and half in shares of Primus common stock.

Primus said the acquisition adds approximately 30,000 customers to its existing base of 70,000. Acquiring Magma also expands Primus' presence in Ottawa, where Magma operates a 7,000 square-foot data center facility.

"We have previously articulated the essential criteria we have established for acquisitions - they have to add scale in our existing major markets, they should be focused on growing our retail customer base, and they need to be accretive to our operating profitably and cash flow," says K. Paul Singh, chairman and chief executive of PRIMUS. "The Magma acquisition meets all of those measures, as well as broadening our service offerings and targeted customers. In addition, Magma's customer base presents opportunities for bundling our VOIP and voice products."