Illuminet-VeriSign merger approved

SCOTT WYLAND, THE OLYMPIAN

LACEY -- VeriSign bought Illuminet on Wednesday for $1.3 billion in stock, closing a deal that had been brewing for months.

Federal regulators cleared the way for VeriSign Inc. to buy Thurston County's largest high-tech company.

Representatives from both companies insisted the merger would not result in immediate layoffs or major reshuffling at the Lacey complex.

However, no one could guarantee that 250 jobs in Lacey wouldn't be cut in the future.

"Layoffs are not anticipated at this time," VeriSign spokeswoman Cheryl Regan said. "We're in separate spaces; we're in separate industries. We have little overlap."

"There's going to be very little change in day-to-day life ... for employees of Illuminet," said Penny Thomas, Illuminet spokeswoman. "Not in the near term. I don't know in the long term."

Thomas said she also has heard no discussion about changing or eliminating the name Illuminet.

Illuminet President Terry Kremian will probably run the Lacey operation, and CEO Roger Moore is likely to be appointed to VeriSign's board of directors, Thomas said.

Thomas cautioned that the moves have not been confirmed.

Most of the changes at the Lacey site will be administrative, Thomas said, such as moving employees to VeriSign's benefit plans and revising job titles to put them in line with VeriSign's.

Based in Mountain View, Calif., VeriSign owns the registry for Internet domain names ending in .com, .net and .org; anyone with a Web site in those domains ultimately goes through VeriSign.

The company expects to pull in $1 billion in revenue this fiscal year.

Illuminet helps telecommunication carriers route calls more efficiently via its computerized signaling system. It also links carriers to the databanks needed for toll-free calls, caller ID and other services.

By acquiring Illuminet, VeriSign now has telecommunication tools to expand and diversify its services, Regan said.

For instance, it will be able to offer phone numbers and Web domain names to businesses and individual users, she said. It will also provide a service that enables callers to reach a business by speaking the company's name.

VeriSign's stock was riding high in mid-2000, trading at $214. It plunged as low as $26.25 in 2001.

Analysts have noted that Illuminet's fortunes became tied to VeriSign's as soon as it agreed to the merger in September.

Although VeriSign's stock prices have plummeted in the past year, the stock is now trading at a higher price since the buyout was first announced, said Peter Wiederspan, vice president of Illuminet's investor relations.

"Last year's stock prices are completely irrelevant in my view," Wiederspan said. "To me, it makes no difference ... because the whole economy has changed in the last year."

However, VeriSign's stock prices have fluctuated, rather than ascended steadily, since the deal was announced.

After the merger was announced, VeriSign's stock rose from $34.98 a share to $48.81 in October, then tumbled to $39.63. It closed Wednesday at $42.75.

Scott Wyland is a business reporter for The Olympian. He can be reached at 360-357-0748 or swyland@olympian.gannett.com.

Company bios

- VeriSign: Provides Internet services such as a registry for Web site domain names. Based in Mountain View, Calif., with some operations in Virginia. Employs about 2,400. Revenue: $897.2 million for past four fiscal quarters. Stock trades on Nasdaq under the symbol VRSN. Wednesday's close: $42.75, up $1.95 or 4.78 percent. 52-week high, low: $119.00 and $26.25. Web site: www.verisign.com.

- Illuminet: Offers connectivity and network services to telecommunications carriers. Based at 4501 Intelco Loop S.E., Lacey. Employs about 540. Revenue: $184.8 million for past four quarters. Stock trades on Nasdaq under the symbol ILUM. Wednesday's close: $39.66, up $1.94 or 5.22 percent. 52-week high, low: $49.29 and $13.06. Web site: www.illuminet.com.

On the Web:

- VeriSign Inc.

- Illuminet

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