Teleglobe to acquire ITXC

ITXC and Teleglobe today announced a merger, creating what the two companies claim will be the largest wholesale voice-over-IP provider in the world and the third largest international carrier overall.

The newly formed parent company of the Teleglobe group of companies, Teleglobe, which will continue to operate under the Teleglobe name and continue operating from its Montreal headquarters, will be listed on NASDAQ.

Following completion of the merger, Liam Strong will continue to serve as Teleglobe’s president and CEO. ITXC chairman and CEO Tom Evslin, who announced his intention to retire earlier this year, will become non-executive chairman. Cerberus Capital Management, Teleglobe's current controlling shareholder, will continue to own a majority of Teleglobe.

The merger, which has been approved by both companies’ boards, brings together ITXC’s global network with the market presence of Teleglobe and should help both companies reduce their overall operational costs.

"The transaction accelerates the things that ITXC needs to do," Evslin said during a conference call today. "We’ve always known we need scale."

From a financial perspective, ITXC's shareholders will receive common shares of a newly formed parent company of the Teleglobe group of companies, representing about 28% of the new company.