Excel reclaims independence from Lucent

It’s déjà vu all over again. Excel Switching, which was acquired in 1999 by Lucent in a $1.7 billion stock deal, is being bought out by an investor group led by Soros Private Equity Investors and Oak Investment Partners.

Under the arrangement, Excel will become a privately held stand-alone entity and be combined with Airslide Systems, a router vendor targeting the wireless market. About 80% of the employees that came to Lucent in the acquisition will become Excel employees with the buyout. Overall, the company will have 150 employees and will remain headquartered in Hyannis, Mass.

It’s also getting a headstart on its customer list, signing an OEM agreement with Lucent under which Lucent will act as a sales channel for Excel’s products. In fact, gaining traction back with switch vendors other than Lucent is one of the primary drivers behind the buy out, said J.C. Murphy, who was the vice president and general manager of the Excel division under Lucent and will be the new entity’s president.

“The unfortunate side of the Lucent acquisition was that some of those customers who viewed Lucent as a competitor wouldn’t consider us,” he said. “In 1998 we had Motorola for wireless local loop and voice recognition products and Ericsson also was a long standing customer too.”

Marc Zionts, former President and CEO of Airslide Systems and former CEO of Westell will serve as Excel’s CEO. Bruce Albelda, CFO of Airslide, will join as CFO. Airslide counts Soros among its venture backers.

“In the fall [of 2002], we were looking at another round of financing,” said Zionts, who is bringing with him seven executives from Airslide into the combined company. “Rather than continue as an unknown entity with an unknown future, I could raise money for an established company.”