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IDT offloads Winstar businesses to GVC

NEWARK, N.J.-IDT Corp. said Detroit-based GVC Networks L.L.C. bought its Winstar subsidiaries, which provide telecommunications services to various U.S. government agencies.

Though terms of the sale have not been disclosed, IDT said that sale includes Winstar Communications L.L.C., Winstar Government Solutions L.L.C. and Winstar Wireless L.L.C.

GVC Networks was formed in 2002 specifically to acquire telecom assets. The company’s new name is GVCwinstar, which is a minority-owned, facilities-based telephone company with licensing to operate internationally as well as domestically. The company has operating authority in 41 states.

IDT purchased Winstar’s fixed-wireless spectrum holdings for $42.5 million after Winstar went bankrupt in 2001. Winstar, along with XO Communications Inc., Teligent Inc. and others, had attempted to break open the fixed wireless market, but found little success.

IDT said at the time that it planned to build a fixed-wireless network platform that will integrate its wireless spectrum with its operational management capabilities and a flexible architecture to “serve the specialized backhaul and telecommunications connectivity needs of a variety of customers, such as cellular phone network providers, commercial enterprises, governmental agencies and first-responders.”

In December 2005, a U.S. bankruptcy court ordered Lucent Technologies Inc. to pay Winstar $244 million plus interest after Winstar sued Lucent over what it said was a botched network supply and buildout contract. Lucent allegedly tried to boost its revenues by pressuring Winstar into purchasing $135 million of software that the company did not need. Lucent has appealed the court’s ruling.

Last year, the SEC revoked Winstar’s stock registration.

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