STOCKHOLM (Reuters) – Swedish cloud computing services provider Sinch AB said on Wednesday it had agreed to buy communications company Inteliquent for $1.14 billion in cash to expand its presence in the United States.<\/p>\n
Shares of the company, which have more than tripled over the last 12 months on the back of the work-from-home trend prompted by the pandemic, jumped another 16% in morning trade.<\/p>\n
A rival of U.S.-based Twilio Inc, the company said the acquisition would expand its role in voice connectivity for enterprises and telecom carriers in the United States.<\/p>\n
Many text messages users get from companies, ranging from banks to food deliverers, use Sinch\u2019s platform.<\/p>\n
\u201cThe acquisition is interesting as it offers growth opportunities ahead, further improves customer stickiness and is highly accretive from start,\u201d analysts at Carnegie said.<\/p>\n
\u201cCompared to our 2021 estimates, Inteliquent will add 33% to group revenues and 59% to gross profit.\u201d<\/p>\n
Founded in 2008 as CLX Communications, the company bought Sinch in 2016 and last year rebranded the entire company to take that name. It counts Softbank-owned SB Management among its investors.<\/p>\n
Inteliquent, owned by private equity firm GTCR, has a broad U.S. presence, reaching over 94.5% of the country\u2019s population and handling 300 billion minutes of traffic on its network annually.<\/p>\n
\u201cOur joint strengths in voice and messaging provide a unique position to grow our business and power a superior customer experience for our customers,\u201d Chief Executive Oscar Werner said in a statement.<\/p>\n
Sinch said it expected the transaction to close in the second half of the year.<\/p>\n
To fund the deal, it will get financing of 8.2 billion crowns from Handelsbanken and Danske Bank, in addition to its existing facilities with the same banks.<\/p>\n