Communication equipment provider InDigiNet
Thursday said it has inked a deal to acquire certain VoIP
The purchase, worth somewhere between $1.5-2.5 million in stock, includes Clarent routers and gateways, which are coded for international usage.
The connection between the two companies is Irvine, Calif.-based InDigiNet’s CEO Mark Ellis, who used to be UBC’s top executive. Ellis says his company intends to pad its product offering for the small-to-medium enterprise (SME) market by offering transport service to/from selected overseas destinations.
“[This] will expand our offerings to cover a more complete spectrum of customer requirements, including a large network of global Points of Presence, thus broadening the capabilities of IGTT’s strategic vision,” Ellis said in a statement.
Taking over some VoIP assets from his former company is not new for InDigiNet. Ellis says the company’s strategy all along has been to acquire the customer bases of smaller, single market communication companies and attractively priced Internet Service Providers (ISPs).
The idea has then been to offer data, local, long distance and wireless services to SMEs over third party networks for those who want to have a suite of services without having to spend the capital to build their own communication network.
“This is also a win for UBC which will be able to turn an under utilized asset into a potentially appreciating equity position of a publicly traded company. We are extremely excited about being in a position to put these assets to work,” he said.
Analysts say the SME market is the best route for InDigiNet to take at this time. Recent estimates signal SMEs account for $120 billion in commercial telephony, data services and technology spending, or 33 percent of the country’s total market and this spending is expected to grow at above average rates over the next ten years.
“This is an important acquisition for IGTT in terms of expansion of capabilities while building a solid asset base,” AGS Chief Consulting Strategist Danny Lee said. “This transaction, along with future planned activities, exemplifies IGTT’s strategy of smart, focused expansion within its business model while actively pursuing additional M&A opportunities.”