logo
Share SHARE
FONT-SIZE Plus   Neg

Vonage Holdings To Buy Vocalocity In $130 Mln Cash-stock Deal - Quick Facts

Vonage Holdings Corp. (VG), a provider of communications services connecting people through cloud-connected devices worldwide, said Thursday that it agreed to acquire privately-held Vocalocity Inc., an industry-leading Software as a Service or SaaS provider of cloud-based communication services to Small and Medium Businesses or SMBs for $130 million. The purchase price includes $105 million in cash and $25 million in Vonage common stock.

The Agreement has been unanimously approved by the boards of directors of Vonage and Vocalocity. Vonage expects that the transaction will be accretive to adjusted Earnings Per Share and on an EBITDA multiple basis in 2015.

The company noted that a portion of the purchase price will be deposited into escrow to partially secure Vonage's indemnification rights under the Merger Agreement in respect of any breach of Vocalocity's representations, warranties or covenants as well as certain other indemnifiable matters.

During the first half of 2013, Vocalocity had revenue of $28 million and growing, implying an annual run rate of greater than $56 million.

Upon closing, Vocalocity CEO Wain Kellum, will join Vonage as President, Business Services, and become a member of the Company's senior leadership team.

Vonage expects to achieve synergies from network operations and the use of technology for serving customers. Synergies in 2015 are estimated to be recurring and in the high single-digit million dollar range.

Vonage noted that it is financing the transaction through $30 million of cash from the balance sheet and $75 million from its credit facility. The company will continue to execute on its balanced approach to capital allocation and expects to complete its $100 million share repurchase program by the end of 2014 as planned.

The transaction is expected to close in the fourth quarter of 2013, subject to customary closing conditions.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Quick Facts

Editors Pick
The World Health Organization or WHO on Tuesday asked the tobacco industry to compensate for the massive environment issues caused by tobacco growing and usage. WHO, in its first report on tobacco's impact on the environment, said the extensive use of chemicals, energy and water, and pollution from manufacturing and distribution of tobacco products, cause massive harm to the environment. Shares of Ryanair Holdings Plc were losing around 2 percent in the early morning trading in London after the Irish no-frills airline Tuesday said it is cautiously guiding a profit increase in fiscal 2018 after reporting weak profit in fiscal 2017. The latest year profit was hurt by the absence of prior year's gain, while revenues increased with strong traffic growth. Hampton Farms has voluntarily recalled Ava's brand organic cashews for potential Listeria contamination. The Organic Cashews Roasted & Salted 8 oz. tubs were distributed in New Jersey, New York, Pennsylvania and Connecticut. As per the recall statement, fewer than 225 units of this product were offered for retail sale.
comments powered by Disqus
Follow RTT