Cannect Communications Inc. (Cannect), a Canadian-controlled integrated communications provider, announced on March 8, 2000 that it had entered into an agreement with Nortel Networks Corp. (Nortel) to deliver the first national Canadian rollout of a carrier-class packet network using Nortel’s Succession platform with national coverage in Vancouver, Toronto, Calgary and Ottawa. The agreement has an estimated value of $97.5 million over the next five years, and will position Cannect to offer revenue-generating voice (local and long distance), data and Internet services to its business customers on a new, next-generation packet network. Cannect plans to begin introducing the network to customers in August, 2000.
McCarthy Tétrault is acting for Cannect with a team that includes George Takach (technology), Lorne P. Salzman (regulatory), and James H. Archer (financing). Nortel relied on its in-house counsel.
Cannect made a simultaneous announcement on March 8, 2000 that it had completed a $33 million private equity financing arranged by Toronto’s Research Capital, which acted as sole manager. The placement includes many of Canada’s leading institutional mutual, pension and venture capital institutions, as well as Nortel Networks. The funds are planned to support Cannect’s expansion into targeted markets.
Chris Hoffman, Andrew Armstrong and Jasprit Gill of McCarthy Tétrault acted for Cannect on the placement. Jay Kellerman and Lisa McDowell of Stikeman Elliott acted for the financiers.