Los Angeles-based content delivery network (CDN) provider EdgeCast Networks gave up its IPO plans, Monday, in favor of a deal that will see it become a part of Verizon's Digital Media Services group.

While the deal gives EdgeCast, which offers traffic spike and content streaming management services, the much needed fund boost to compete effectively with Akamai and Limelight, it will give fillip to Verizon's enterprise business, which has been stagnating over the years, and also access to EdgeCast's 6000-odd clients, including Mercedes Benz, Twitter, LinkedIn, Pintetest, Kellogg's, Yahoo! and Hulu.

"The combination of EdgeCast and Verizon Digital Media Services will allow us to fully exploit and accelerate growth in Internet media consumption and online business performance," said Bob Toohey, president of Verizon Digital Media Services. "EdgeCast's industry-leading technology and strategically placed assets, combined with Verizon Digital Media Services' video solutions, improves our ability to deliver the rich, reliable and quality digital media services that our customers have come to expect."

The deal may sour EdgeCast's relation with some big-name clients like Deutsche Telekom, Telus and Pacnet, to whom the company provides routing and dashboard management services, but the loss will be offset by Verizon's own enterprise clients and increased demand of value-added services.

"Having journeyed from startup to technology leader in a short seven years, the time is right for EdgeCast to elevate itself again by joining Verizon to continue our innovation and growth," said Alex Kazerani, EdgeCast chairman and chief executive officer. EdgeCast was founded in 2006 and became profitable in 2009.

The companies have not disclosed the financial terms of the deal but TechCrunch has put the figure at over $350 million.

Verizon Communications Inc.'s shares closed 0.18 percent up at $49.57 at the NYSE on Monday. 

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