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CWIE Buys Embattled Alpha Red

By Liam Eagle, theWHIR.com

October 6, 2008 -- (WEB HOST INDUSTRY REVIEW) -- CWIE Holdings Company Inc. (www.cwie.com), the parent company of CCBill (www.ccbill.com) and CaveCreek Web Hosting (www.cavecreek.com) confirmed on Monday that it had agreed to acquire hosting company Alpha Red (www.alphared.com), a deal that has reportedly been in discussion since Friday.

The company issued a press release late Monday saying it had acquired all of Alpha Red's hosting assets, including its two privately-owned data centers in Houston, Texas, 300Gps of Internet connectivity and connections in 16 carrier neutral facilities.

Alpha Red's fate has been a matter of discussion since last week, when it was reported that Microsoft had teamed up with the state of Washington to file a lawsuit against Alpha Red, its CEO James McCreary and another company allegedly belonging to McCreary, Branch Software, which the suit accused of distributing illegal "scareware."

After a period of silence that invited a great deal of online speculation, Alpha Red said late Friday evening in a message board posting that it had entered into discussions to be acquired by CWIE.

In a call with the WHIR, CWIE VP of education and marketing Laurie Biviano said the acq uisition discussions began following the announcement of the lawsuit.

While not many details of the deal were yet available, including what parts of the Alpha Red staff would remain with the company following the acquisition, CWIE, director of business development Walter Hirsekorn did say that McCreary would not be associated with the company any further.

Hirsekorn says he expects that while specific officers of the company were named in the lawsuit, that Alpha Red would not be facing the threat of shutdown from the suit following the acquisition. CWIE, he says, has a long-standing partner relationship with Microsoft. Understandably, the company has no desire to get in the way of a legal battle.

Alpha Red specializes in providing hosting - including dedicated servers, colocation and dedicated Ethernet transit connections - to bandwidth-heavy customers. According to the press release, the acquisition will enable the company to retain long-term operational funding to continue serving its clients.

"We are extremely pleased to announce this purchase and to welcome Alpha Red and their valued clients to the CWIE family of companies," said CWIE CEO Ron Cadwell, quoted in the press release.

Biviano said more information about the acquisiton would become available in the next week or so.