 1 Investor Presentation January 2011 Filed by Primus Telecommunications Group, Incorporated Pursuant to Rule 425 under the Securities Act of 1933 Subject Company: Arbinet Corporation Registration No.: 333-171293 |
 2 Safe Harbor In connection with the proposed acquisition, Arbinet Corporation (“Arbinet”) and Primus Telecommunications Group, Incorporated (“Primus”) have filed a joint proxy statement/prospectus with the Securities and Exchange Commission (the “SEC”). INVESTORS AND SECURITY HOLDERS ARE URGED TO CAREFULLY READ THE JOINT PROXY STATEMENT/PROSPECTUS, BECAUSE IT CONTAINS IMPORTANT INFORMATION. A definitive joint proxy statement/prospectus will be sent to security holders of both Arbinet and Primus seeking their approval with respect to the proposed acquisition. Investors and security holders may obtain a free copy of the joint proxy statement/prospectus and other documents filed by Arbinet and Primus with the SEC, without charge, at the SEC’s web site at www.sec.gov. Copies of the joint proxy statement/prospectus and Primus’s SEC filings that were incorporated by reference in the joint proxy statement/prospectus may also be obtained for free by directing a request to: (i) Primus 703-748-8050, or (ii) Arbinet (Andrea Rose/Jed Repko Joele Frank, Wilkinson Brimmer Katcher (212) 355-4449). Participants Arbinet, Primus, and their respective directors, executive officers and other members of their management and employees may be deemed to be “participants” in the solicitation of proxies from their respective security holders in respect of the proposed acquisition. INFORMATION ABOUT THESE PERSONS CAN BE FOUND IN EACH COMPANY’S 2009 ANNUAL REPORT ON FORM 10-K AND SUBSEQUENT STATEMENTS OF CHANGES IN BENEFICIAL OWNERSHIP ON FILE WITH THE SEC. THESE DOCUMENTS CAN BE OBTAINED FREE OF CHARGE FROM THE SOURCES LISTED ABOVE. ADDITIONAL INFORMATION ABOUT THE INTERESTS OF SUCH PERSONS IN THE SOLICITATION OF PROXIES IN RESPECT OF THE PROPOSED ACQUISITION WILL BE INCLUDED IN THE JOINT PROXY STATEMENT/PROSPECTUS TO BE FILED WITH THE SEC. This document includes “forward-looking statements” as defined by the SEC. All statements, other than statements of historical fact, included herein that address activities, events or developments that Arbinet or Primus expects, believes or anticipates will or may occur in the future, including anticipated benefits and other aspects of the proposed acquisition, are forward-looking statements. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of their dates. Except as required by law, neither Arbinet nor Primus intends to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise. Important Information and Where to Find It in the Solicitation Forward-Looking Statements |
 Primus Today U.S. headquartered international business with operations in Canada, Australia, the U.S., and Brazil Provider of voice and data communication services to residential, business and carrier customers Growth services: broadband, IP-based voice, on-net local, data and data center services Traditional businesses: domestic and international long-distance, off-network local, prepaid cards and dial-up internet services Wholesale services: Inter-continental IP and TDM wholesale access and transport Global reach provided by extensive IP-based network assets Revenue well distributed by geography, product and customer type Leading global provider of advanced facilities-based communication solutions |
 Extensive IP-Based Network Assets Wholesale Terminate 5 billion minutes annually to over 240 countries Direct/transit connections to over 100 countries Connects Primus’ network with Tier 1 and 2 fixed and mobile network operators worldwide IP soft Switches TDM Switches Fiber Capacity United States IP-based softswitch network supporting wholesale and international traffic Leased domestic fiber and leased / owned oceanic fiber to Europe and Australia Interconnected with PRIMUS’ global network Europe IP-based softswitch in London Interconnected with PRIMUS’ global network Owned trans-Atlantic fiber capacity Canada 6 IP-based softswitches 26 PoPs 70 ILEC colocations with ADSL 2+ capabilities 7 data centers in 5 cities; 30,000 sq. ft. built and 118,000 sq. ft. of capacity National fiber network with 100% IP-based capabilities Fiber ownership to U.S on East and West coasts Australia Owned national IP and TDM network Fiber network passing ~1,000 buildings in Sydney and Melbourne 66 PoPs providing national coverage 3 data centers in two cities; 22,000 sq. ft. of built capacity 281 owned DSLAMs with local and ADSL2+ capabilities Switch facilities in Sydney, Brisbane, Adelaide, Melbourne and Perth Owned trans-Pacific fiber capacity Brazil Data center facility in Sao Paolo IP-voice provider to businesses and carriers Interconnected with PRIMUS’ global network |
 Primus Investment Highlights Drive profitable growth in areas of long-term sustainable advantage Scale Canada, Australia, and Global Wholesale Feed growth businesses: IP- and data- based services for enterprises, consumers Harvest cash flows in traditional businesses Executing asset portfolio strategy through strategic alternatives Arbinet doubles wholesale business and creates unique product set, significant synergies Exiting unproductive, non-scalable businesses Evaluating other M&A opportunities Generating free cash flow, growing cash balance Focused on balanced sheet transformation through cash generation, proceeds of any divestitures Management team with extensive telco, cable, and data center experience |
 The Primus Portfolio – Sum of the Parts Adjusted Adjusted EBITDA (US$ 000s) Revenue EBITDA (1) Capex less Capex Canada $172.4 $34.9 $7.3 $27.6 Australia 205.7 29.8 7.6 22.2 Global Wholesale 137.6 3.2 0.1 3.1 Sub-Total $515.7 $67.9 $15.0 $52.9 US Retail $38.8 $4.1 $0.8 $3.3 Brazil 21.3 1.3 0.8 0.4 Corporate / India - (7.6) - (7.6) $575.8 $65.7 $16.7 $49.0 Discontinued Operations 36.4 (0.4) 0.3 (0.8) Severance - (6.1) - (6.1) Total $612.2 $59.2 $17.1 $42.2 YTD Q310 Total before Discontinued Operations Canada 30% Australia 35% Wholesale 24% US 7% Brazil 4% 6 Canada 48% Australia 41% Wholesale 4% US 5% Brazil 2% Notes: 1. A non-GAAP financial measure. Definitions and reconciliations between non-GAAP measures and relevant GAAP measures are available in the Appendix and in the Company’s periodic SEC filings. |
 Primus Canada Highlights 7 • Headquartered in Toronto, Ontario • C$240M revenue in annualized revenue • 800 employees • Data centers and sales offices in BC, Alberta, and Ontario • 450K customers across the country • 70 DSLAMs (primarily in Ontario & Quebec) • Provide on-net equal access to ~90% of population • Call centers in Ontario (Ottawa) and New Brunswick |
 Primus Australia Highlights 8 • Headquartered in Melbourne • A$305 million in annualized revenue • 575 employees • 3 Data Centers in Melbourne and Sydney • Offices in Melbourne, Sydney, Adelaide, Brisbane and Perth • 250K customers located in all territories • 5 carrier-grade voice switches and 66 points of interconnect • 281 DSLAMs primarily in major cities and surrounding suburbs • Central business district metro fiber in Sydney and Melbourne |
 Global Wholesale Services Key Combination Considerations: • Increased scale in carrier services market • Benefits of thexchange™ – Arbinet’s world-class telecommunications trading platform • Added products and services and enhanced access to certain international routes • Complementary market presence • Synergy potential of $3 million to $7 million (when fully integrated) • Consolidation benefits for network and facilities 9 Combined PRIMUS Before (all figures in millions and annualized, except customers) Carrier Arbinet Synergies Revenue (1) $183.4 $330.0 $513.4 Gross Margin (1) $10.8 $25.0 $35.8 Gross Margin % 5.9% 7.6% 7.0% Customers 262 1,237 Minutes of Use 4,340 12,667 (1) Revenue and Gross Margin are presented net of Bad Debt allowance. YTD Q310 Annualized |
 Q3 and YTD 2010 Highlights 10 All results of operations exclude Discontinued Operations and severance unless otherwise specified. 1. EBITDA excludes impact of severance expenses, $4.2 million in Q310 and $1.8 million in Q110 and is a non-GAAP financial measure. Definitions and reconciliations between non-GAAP measures and relevant GAAP measures are available in the Appendix and in the Company’s periodic SEC filings. 2. Free Cash Flow is defined as Cash Flow from Operating Activities less Capital Expenditures. (US$ 000s) Q309 Q310 Change Q309 Q310 Change Revenue $194.9 $188.2 ($6.7) $560.2 $15.6 Gross Margin 68.1 67.3 (0.8) 196.4 209.0 12.6 Gross Margin % 34.9% 35.8% 0.9% 35.1% 36.3% 1.2% Adjusted EBITDA (1) $21.2 $20.0 ($1.2) $60.7 $65.7 $5.1 EBITDA % 10.9% 10.6% -0.3% 10.8% 11.4% 0.6% Capex 3.9 6.4 2.5 9.5 16.7 7.2 Free Cash Flow (2) 9.1 14.5 5.4 30.3 20.3 (10.0) Cash Balance $41.9 $49.6 $7.7 $41.9 $49.6 $7.7 Quarter ended YTD Notes: |
 Financial Summary Revenue Adjusted EBITDA (1) (2) Capital Expenditures Free Cash Flow (1) ($ Millions) 11 $195 $203 $193 $195 $188 $0 $50 $100 $150 $200 $250 Q309 Q409 Q110 Q210 Q310 -3.3% % Sequential Change 5.9 % 4.0% -4.7% 0.8% 3.4% % of Revenue 2.0% 2.7% 2.5% 3.0% 10.6% % of Revenue 10.7% 10.8% 11.8% 11.7% $14 ($7) $13 $6 $9 -$10 -$5 $0 $5 $10 $15 $20 Q309 Q409 Q110 Q210 Q310 $21 $22 $23 $23 $20 $0 $5 $10 $15 $20 $25 Q309 Q409 Q110 Q210 Q310 $6 $6 $5 $6 $4 $0 $2 $4 $6 $8 $10 Q309 Q409 Q110 Q210 Q310 7.4% % of Revenue 4.7% 3.0% 6.7% (3.6)% Note: All results of operations exclude Discontinued Operations unless otherwise specified. (1) A non-GAAP financial measure. Definitions and reconciliations between non-GAAP measures and relevant GAAP measures are available in the Appendix and in the Company’s periodic SEC filings. (2) Adjusted EBITDA excludes impact of severance charges in Q109 ($1.8 million) and Q310 ($4.2 million). |
 12 Canada Overview Net Revenue Adjusted EBITDA (1) (0.8)% 59.1 (CAD$) $63.1 $62.1 $59.8 $59.6 Sequential Change (2.0)% (1.6)% (3.6)% (0.4)% 20.0% (3.3)% $11.8 (CAD$) $12.8 $11.8 $12.1 $12.2 Sequential Change (7.9)% (7.8)% 2.5% 0.8% % of Revenue 20.3% 19.1% 20.2% 20.5% ($Millions) ($Millions) Most profitable business unit in the portfolio Stable EBITDA averaging 20% of net revenue despite declining revenues 40% and 7% growth year- over-year in Hosted IP/PBX and data center revenues, respectively Effective cost controls helped offset the impact of declining revenues on EBITDA and free cash flow (1) A non-GAAP financial measure. Definitions and reconciliations between non-GAAP measures and relevant GAAP measures are available in the Appendix and in the Company’s periodic SEC filings. |
 13 Australia Overview Net Revenue Adjusted EBITDA (1) (0.8)% $75.8 (AUS$) $76.5 $75.9 $77.3 $76.4 Sequential Change (0.9)% (0.8)% 1.9% (1.2)% (1) A non-GAAP financial measure. Definitions and reconciliations between non-GAAP measures and relevant GAAP measures are available in the Appendix and in the Company’s periodic SEC filings. 13.2% (2.9)% $10.0 (AUS$) $9.8 $9.7 $12.9 $10.3 Sequential Change (10.1)% (1.0)% 33.0% (20.2)% % of Revenue 12.9% 12.8% 16.6% 13.5% ($Millions) ($Millions) Stable revenue stream Declining residential revenue replaced by higher margin business revenue 46% growth year-over-year in data center revenues and 6% growth for business revenues in aggregate Adjusted EBITDA of 13.2% of net revenue in Q310 versus 12.9% in Q309 $68.4 $69.9 $63.7 $69.0 $67.5 $60 $64 $68 $72 Q309 Q409 Q110 Q210 Q310 $9.0 $9.1 $11.6 $8.8 $8.2 $0 $2 $4 $6 $8 $10 $12 $14 Q309 Q409 Q110 Q210 Q310 |
 Global Wholesale Overview Net Revenue Gross Margin % (1) $53.6 $54.9 $46.5 $49.2 $41.9 $0 $20 $40 $60 $80 Q309 Q409 Q110 Q210 Q310 4.1% 3.9% 3.7% 4.9% 5.2% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% Q309 Q409 Q110 Q210 Q310 (1) A non-GAAP financial measure. Gross Margin % is defined as Net Revenue less costs of revenue divided by Net Revenue. (14.9)% Sequential Change 6.5% 2.5% (15.3)% 5.8% ($Millions) ($Millions) Gross margins, as a percentage of net revenue, improved 110 basis points to 5.2% in Q310 versus Q309 as we focused on higher margin US domestic terminations Summer seasonality in Europe had expected effect on quarterly traffic Focus on profitability vs. Revenue drove decision to prune less profitable traffic 14 |
 Primus’ Other Businesses United States: Net Revenue for the quarter decreased $4.1 million year over year to $12.1 million Adjusted EBITDA for the quarter decreased $1.6 million year over year to $0.9 million Brazil: Net Revenue for the quarter increased BRR 8.2 million year over year to BRR 15.9 million Adjusted EBITDA for the quarter remained flat year over year as the significant increase in revenue was derived from low-margin reseller voice services Europe Retail: All European retail operations classified as “Discontinued Operations” in the financial statements $6.2 million (non-cash) impairment charge for goodwill and long-lived assets, primarily intangibles established as part of fresh start accounting Adjusted EBITDA of (€2K) and (€71K) for the third quarters 2010 and 2009, respectively |
 16 Foreign Currency Effects More than 80% of revenue generated outside US Natural in-country currency hedge Revenue and costs are largely denominated in each country’s local currency Impact of currency fluctuations driven by US dollar remittances from foreign units to service debt .5688 0.9617 0.9023 Q310 0.5536 0.9602 0.9036 Q110 0.5559 0.9731 0.8835 Q210 0.5800 0.9900 0.9900 As of 11/15/10 Q309 Q409 AUD $ 0.8323 0.9087 CAN $ 0.9097 0.9460 BRR 0.5335 0.5728 Average Exchange Rate to US$ |
 17 Balance Sheet ($US Millions) (1) A non-GAAP financial measure. Definitions and reconciliations between non-GAAP measures and relevant GAAP measures are available in the Appendix and in the Company’s periodic SEC filings. Q309 Q409 Q110 Q210 Q310 Total Debt / LTM Adjusted EBITDA 3.30x 3.15x 2.99x 2.79x 2.81x Net Debt / LTM Adjusted EBITDA 2.76x 2.63x 2.38x 2.40x 2.24x Interest Coverage Ratio 2.50x 1.77x 2.45x 2.69x 2.31x Note: All results of operations exclude Discontinued Operations and severance unless otherwise specified. Cash balance of $49.6 million at September 30, 2010 Principal amount of total debt at 9/30/10 was $245.9 million compared to $246.3 million at 6/30/10 Improving leverage ratios |
 Primus Investment Highlights Drive profitable growth in areas of long-term sustainable advantage Scale Canada, Australia, and Global Wholesale Feed growth businesses: IP- and data- based services for enterprises, consumers Harvest cash flows in traditional businesses Executing asset portfolio strategy through strategic alternatives Arbinet doubles wholesale business and creates unique product set, significant synergies Exiting unproductive, non-scalable businesses Evaluating other M&A opportunities Generating free cash flow, growing cash balance Focused on balanced sheet transformation through cash generation, proceeds of any divestitures |
 Competitive Landscape Alog, Diveo, UOL, Locaweb, Transit, GVT, Datora Telstra, Optus, AAPT, iiNet, TPG Bell Canada, Telus, MTS Allstream, Rogers, COGECO, Shaw, Globalive, Videotron Wholesale units of major global carriers TaTa, Begacom, iBasis KPN Vonage, Cbeyond, XO, Paetec, Verizon, AT&T Quality Value Strong brand identity Extensive sales staff Quality of service Value Customer care Strong brand identity Value Quality of service Strong managed services team Largest geographical internet data center coverage Direct global interconnects Quality of service Pricing Quality of IP-PBX Platform Value Geography Primary Services Primary Competitors PRIMUS’ Advantages Data-hosting VoIP services Broadband access International Voice Residential Voice, VOIP Business Voice, IP-PBX services Brazil Australia Canada Wholesale U.S. Residential – Value Provider Voice, Broadband, IP, wireless, local Business – Full Solution Provider Voice, broadband, IP, hosting, data, wireless MVNO Residential – Value Provider Voice, broadband, local, wireless MVNO Business – Full Solution Provider with SME Focus Voice, broadband, IP, local, wireless, hosting services |
 20 Adjusted EBITDA Adjusted EBITDA, as defined by us, consists of net income (loss) before reorganization items, net, share-based compensation expense, depreciation and amortization, asset impairment expense, gain (loss) on sale or disposal of assets, interest expense, amortization or accretion on debt discount or premium, gain (loss) on early extinguishment or restructuring of debt, interest income and other income (expense), gain (loss) from contingent value rights valuation, foreign currency transaction gain (loss), income tax benefit (expense), income (expense) attributable to the non-controlling interest, income (loss) from discontinued operations, net of tax, and income (loss) from sale of discontinued operations, net of tax. Our definition of Adjusted EBITDA may not be similar to Adjusted EBITDA measures presented by other companies, is not a measurement under generally accepted accounting principles in the United States, and should be considered in addition to, but not as a substitute for, the information contained in our statements of operations. We believe Adjusted EBITDA is an important performance measurement for our investors because it gives them a metric to analyze our results exclusive of certain non- cash items and items which do not directly correlate to our business of selling and provisioning telecommunications services. We believe Adjusted EBITDA provides further insight into our current performance and period to period performance on a qualitative basis and is a measure that we use to evaluate our results and performance of our management team. Free Cash Flow Free Cash Flow, as defined by us, consists of net cash provided by (used in) operating activities before reorganization items less net cash used in the purchase of property and equipment. Free Cash Flow, as defined above, may not be similar to Free Cash Flow measures presented by other companies, is not a measurement under generally accepted accounting principles in the United States, and should be considered in addition to, but not as a substitute for, the information contained in our consolidated statements of cash flows. We believe Free Cash Flow provides a measure of our ability, after purchases of capital and other investments in our infrastructure, to meet scheduled debt principal payments. We use Free Cash Flow to monitor the impact of our operations on our cash reserves and our ability to generate sufficient cash flow to fund our scheduled debt maturities and other financing activities, including discretionary refinancings and retirements of debt. Because Free Cash Flow represents the amount of cash generated or used in operating activities less amounts used in the purchase of property and equipment before deductions for scheduled debt maturities and other fixed obligations (such as capital leases, vendor financing and other long-term obligations), you should not use it as a measure of the amount of cash available for discretionary expenditures. Non-GAAP Measures Note: All results of operations excluded Discontinued Operations unless otherwise specified. Three Months Three Months Three Months Ended Ended Ended September 30, June 30, September 30, 2010 2010 2009 NET INCOME (LOSS) ATTRIBUTABLE TO PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED 5,080 $ (13,038) $ 2,165 $ Reorganization items, net - - 307 Share-based compensation expense (12) 117 307 Depreciation and amortization 13,641 18,194 18,740 (Gain) loss on sale or disposal of assets - (189) 36 Interest expense 8,602 8,733 8,747 Accretion (amortization) on debt premium/discount, net 46 45 - (Gain) loss on early extinguishment of debt - (164) - Interest and other (income) expense (254) (153) (160) (Gain) loss from Contingent Value Rights valuation (33) 382 4,229 Foreign currency transaction (gain) loss (14,006) 9,623 (13,448) Income tax (benefit) expense (3,238) (1,883) (2,121) Income (expense) attributable to the non-controlling interest 74 (106) 210 (Income) loss from discontinued operations, net of tax 5,464 1,528 2,110 (Gain) loss from sale of discontinued operations, net of tax 389 (193) 110 ADJUSTED EBITDA 15,753 $ 22,896 $ 21,232 $ NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES BEFORE REORGANIZATION ITEMS 20,865 $ (1,140) $ 12,992 $ Net cash used in purchase of property and equipment (6,410) (5,824) (3,886) FREE CASH FLOW 14,455 $ (6,964) $ 9,106 $ |