FACTS AT A GLANCE
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Nortel Networks to Acquire Alteon WebSystems for US$7.8 Billion -
Will Establish Leadership Position in Delivering
High-Performance Internet Data Centers for the New Networked Economy
WHO: Nortel Networks (www.nortelnetworks.com), a global Internet and
telecommunications networking giant that is building the next
generation high-performance Internet, and San Jose, Calif.-based
Alteon WebSystems, Inc. [Nasdaq: ATON] (www.Alteon WebSystems.com),
the leading provider of intelligent Internet data management solutions
and content aware switching technology.
WHAT: Nortel Networks today announced an agreement to acquire Alteon
WebSystems, a publicly traded company that provides leading-edge
content aware switching technology. Alteon WebSystems enables
businesses to process, track and intelligently forward Web sessions at
gigabit rates while applying sophisticated traffic control services to
each session. According to a recent study by the Dell'Oro Group,
Alteon WebSystems is market share leader in content aware switching,
capturing 50 percent of the market.
The acquisition will establish a leadership position for Nortel
Networks in the exploding in the content switching market. According
to IDC, the market is set to grow 80 percent CAGAR in the next 4 years
to US$4 billion in 2004.
Alteon WebSystems was founded in 1996. Alteon WebSystems' customer
footprint is unmatched and boasts leaders in the enterprise and
emerging service provider markets including Yahoo!, Excite@Home, NTT,
Buy.com, DLJDirect, CitySearch-Ticketmaster Online, Exodus
Communications, Loudcloud, Digex, UUNET, Cable & Wireless, Virgin,
Global Crossing, ICG Communications, GTE Internet, Concentric
Networks, and Microsoft WebTV. Alteon WebSystems is credited with
pioneering the concept of Web switching.
Alteon WebSystems's flagship Layer 4-7 Web switching technology allows
service providers such as ISPs and enterprises to:
o Increase network throughput by as much as 20-40 percent by
scaling and optimizing the efficiency of servers and server-based
applications
o Lowers the cost of the products, increases functionality, and
improves customer implementation and operations
o Ensure non-stop availability of their sites and services
o Balance servers, firewalls, and network switches and routers.
WHEN: The acquisition, which is subject to customary regulatory and Alteon
WebSystems shareholder approvals, is expected to close in fourth
quarter of 2000.
WHERE: Nortel Networks is a global company with more than 80,000 employees
worldwide. Alteon WebSystems employs approximately 500 people. Dominic
Orr, Alteon WebSystems' President and CEO will drive the development
of their technology with Nortel Networks, as an integral part of
Nortel Networks Content Distribution Networks business unit.
HOW: Nortel Networks will pay US$7.8 billion in Nortel Networks common
shares in a fully diluted basis to acquire Alteon WebSystems.
CONTACT: Melissa Zipin, 781-238-5726, or David Chamberlin, 972-685-4648
Certain information included herein is forward-looking and is subject to
important risks and uncertainties. The results or events predicted in these
statements may differ materially from actual results or events. Factors which
could cause results or events to differ from current expectations include, among
other things: the impact of price and product competition; the dependence on new
product development; the impact of rapid technological and market change; the
ability of Nortel Networks to make acquisitions and/or integrate the operations
and technologies of acquired businesses in an effective manner; general industry
and market conditions and growth rates; international growth and global economic
conditions, particularly in emerging markets and including interest rate and
currency exchange rate fluctuations; the impact of consolidations in the
telecommunications industry, the uncertainties of the Internet; stock market
volatility; the ability of Nortel Networks to recruit and retain qualified
employees; and the impact of increased provision of customer financing by Nortel
Networks. For additional information with respect to certain of these and other
factors, see the reports filed by Nortel Networks with the United States
Securities and Exchange Commission. Nortel Networks disclaims any intention or
obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
Investors and security holders are advised to read the proxy
statement/prospectus regarding the transaction to be filed with the Securities
and Exchange Commission by Nortel Networks and Alteon WebSystems, as it will
contain important information. Security holders may obtain a free copy of the
proxy statement/prospectus (when available) and other related documents filed by
Nortel Networks and Alteon WebSystems at the Commission's website at
www.sec.gov. When available, the proxy statement/prospectus and the other
documents may also be obtained from Nortel Networks Corporation, Attention:
Investor Relations 8200 Dixie Road, Suite 100 Brampton, Ontario L6T 5P6 Canada
Alteon WebSystems, its directors, executive officers and certain other members
of Alteon WebSystems' management and employees may be soliciting proxies from
Alteon WebSystems' stockholders in favor of the merger. Information concerning
the participants will be set forth in the proxy statement/prospectus when it is
filed with the Securities and Exchange Commission.
