Network infrastructure provider Enterasys hopes its acquisition by rival Extreme Networks will see it jump into the top four companies in the industry.
Extreme bought the Boston-based firm earlier this month for $180m - despite Enterasys having an estimated annual revenue of $300m.
But CEO Chris Crowell told CBR he was happy with the sum paid and that the "merger" - as he called it - means the businesses will have a much larger R&D budget with more reach into key markets, making it a bigger player in the sector.
Crowell said: "We're very positive about the prospects. In reality it comes together as a merger. The idea is to try to get the best of the best and really become a number three/four competitor in the marketplace [behind Cisco at number one].
"It's important to have a critical mass as a company. From an R&D point there's a barrier to entry. You have to get to a certain point or you can't even get into it.
"Being bigger gives you an economy of scale because if you're building the same thing suddenly we have more money to build other things."
Crowell would not be drawn on what those other things would be, but hinted at exploring different price points and developing their fibre and copper connectivity products.
The CEO said Extreme's connections would give Enterasys more reach in the Asia Pacific market and an opportunity to grow in the Middle East, while Extreme should benefit from Enterasys's market presence in Brazil and Eastern Europe.
He said both firms have an equal presence in the UK, where his company provides WiFi for Bart's Health NHS Trust.
CMO Vala Afshar added that Enterasys, with the weight of Extreme behind it, should set its sights beyond fourth place in the industry.
"None of us are happy at just being fourth," he said.
Crowell believes opportunities will grow as the proliferation of mobile devices and the Internet of things drive demand for network solutions.
"That innovation is not just needed where you connect but also in the back end with the data centres and applications," he added.
The sale of Enterasys represents a loss for its former owner Gore Systems, which spent $386m taking it private in 2006.
Crowell said the deal should go through by mid-November.
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