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The wisdom of any major acquisition can be assessed only with a bit of hindsight, so the recent PAETEC acquisition of Cavalier Telephone (News - Alert) cannot be assessed immediately.

Some will note that roughly 75 percent of Cavalier's business is consumer, rather than business, which would seem a poor fit for PAETEC's (News - Alert) current business profile. To be sure, Cavalier's optical fiber network and business is arguably quite a good fit with the existing focus on business customers, and a bit of a hedge as it expands PAETEC's geographic footprint. 

Cavalier had $390 million in sales in the year leading up to the acquisition. However, the company’s fiber division itself generated only about $98 million, or 25 percent, of total revenue. That means that a vast majority of Cavalier’s business is arguably of the consumer or smallish business sort which PAETEC does not traditionally serve.

Cavalier's current customer tends to produce about $2,300 in monthly revenue. The majority of Cavalier’s revenue comes from consumer accounts and small businesses with monthly recurring revenue of only about $500. 

But the wisdom can be assessed only with some passage of time. PAETEC might want to expand its core customer segments "out of region," or might ultimately spin off the consumer assets. It is just too early to tell. 

Click here for one perspective on the deal.