EarthLink buying CenterBeam for $22 million

ATLANTA (AP) -- Internet service provider EarthLink is buying cloud computing and hosted IT services provider CenterBeam Inc. for $22 million.

EarthLink was one of the best-known Internet service providers, but has struggled with intense competition from higher-speed providers like cable companies. The Atlanta company has made several acquisitions to help broaden its business services and is transitioning to an information technology company with data centers and cloud computing services that it hopes will prove more profitable.

Privately held CenterBeam is an information technology managed service provider based in Sunnyvale, Calif. It runs a 140-person IT support center providing help desk, desktop technical support and application support services.

"The acquisition of CenterBeam will fast-track our IT services product development by providing us with critical scale and complementary product capabilities geared towards our multi-location business target market," EarthLink Chairman and CEO Rolla Huff said in a statement on Monday.

EarthLink said that it plans to offer CenterBeam's 365+ enterprise cloud service and its hosted voice platform through its existing distribution channels. CenterBeam's service control portal will be integrated into EarthLink's myLink next generation control portal.

The deal is expected to close in the third quarter.

EarthLink Inc.'s stock rose 11 cents to $6.17 in midday trading.