Energis spends £500m to bolster European presence

Eight year-old Ision hosts 35 per cent of the key German content sites and scores 23 per cent of all page views in the country. Customers include two of the top three German banks, Deutsche Bank and Commerzbank, and eight of the top media companies.

Tim Dillon of telco analysts Current Analysis said: "The price is not too bad and it will give Energis local access. It shifts it up the value chain in Germany, which is one of the best-growing European markets for data operations."

He added that it was a major problem for any operator competing with Deutsche Telekom to find premises and gain access to the local loop and main network.

Mike Grabiner, Energis CEO, said: "This acquisition significantly strengthens our operations in Germany and takes a major step in our strategy to become the leading data and internet solutions provider in Europe."

Ision hosts 800 complex sites and has 30,000 SME customers in Germany. The SME market is regarded as the most profitable and fastest growing market for telecoms carriers. As Ision operates mainly on leased lines, access to Energis' strong German network should cut costs significantly.

The German company has projected revenues of £58.9m this year, with losses before tax and interest of £37m.

Energis paid around £33.5 per share for Ision, a 10 per cent premium on the market price but considerably less than its issue price of £41.9 per share on the Neuer Market in March of this year.

Energis has, almost by stealth, built up a significant presence in the European market. In the last 15 months, it has acquired Unisource Carrier Services, a pan-European carriers' carrier, BusinessOnline and carrier24 in Germany and EnerTel in Holland.

Last month Energis released half year figures showing turnover up 81 per cent to £368m and a UK operating profit of £20.3m, as compared to a £2.7m loss in the first half of the previous year.