[luau] Pihana Downtown To Close

John Christian jwchr at yahoo.com
Wed Oct 9 17:53:01 PDT 2002


October 9, 2002
http://the.honoluluadvertiser.com/article/2002/Oct/09/bz/bz01a.html/?print=on
Tech firm will close HQ

By John Duchemin
Advertiser Staff Writer

Pihana Pacific, one of the largest Hawai'i-based technology 
companies, said yesterday that it plans to close its headquarters and 
lay off or transfer dozens of employees as part of a recently 
announced merger.

Pihana, a 2-year-old Internet data center company, notified the state 
Department of Labor and Industrial Relations yesterday that it will 
lay off or transfer 53 of the headquarters' 54 employees by Dec. 3. 
That's also the expected closing date of its three-way merger with 
Equinix and Singapore Telecommunications Telemedia.

Pihana human resources director Ryan Okahara said yesterday that the 
Honolulu headquarters was being eliminated as an "inevitable 
redundancy."

"As in any other merger, we will not need three headquarters," Okahara said.

Under the merger announced last week, data center company Equinix, 
based in Mountain View, Calif., will absorb Pihana's seven data 
centers into its network. A handful of employees will remain at 
Pihana's airport data center, Okahara said.

Other Hawai'i employees will be offered transfers to offices in Asia 
or on the U.S. Mainland. The company has not decided who will be 
offered transfers or which senior managers will be retained, Okahara 
said.

If the merger goes through, it will mark the end of one of the bigger 
players in the Hawai'i technology industry. Pihana made national 
headlines in October 2000 when, under founder Lambert Onuma, it 
obtained about $240 million from a consortium of venture investors 
led by Goldman Sachs in the largest single venture investment into a 
Hawai'i technology company.

"Hawai'i got a lot of good coverage when that happened," said Ann 
Chung, executive director of the Hawai'i Technology Trade 
Association. "The fact they were able to raise so much money was a 
real positive for the industry here."

Pihana spent much of its money building a data center network in Los 
Angeles, Sydney, Tokyo, Seoul, Singapore and Honolulu, counting on 
increasing demand for data storage, Internet services and secure 
server sites. While the 160-employee company's Honolulu offices 
controlled central administrative tasks, other important functions 
were spread around its Pacific sites.

Pihana's Honolulu employee count peaked above 80 last year. But sales 
sagged as the telecommunications industry tumbled through 2001, and 
the company laid off a few dozen workers after the Sept. 11 terrorist 
attacks.

Okahara said the merger makes Pihana part of a stronger company.

"A larger entity with more coverage gives you more synergy," he said. 
"If you're going it alone, you may have the money to run your 
business but you have to do everything yourself. With this merger 
we'll have more assets."


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