Wool communication company Twilio Inc.
has agreed to invest as much as $ 750 million in Syniverse Technologies LLC as a precursor to a public listing for the privately held messaging company.
The investment, announced Monday, could be followed in the coming months by a merger between Syniverse and a specialty venture, people familiar with the matter said Sunday when The Wall Street Journal reported the news for the first time. Such an agreement could be appreciated by Syniverse, which is owned by the private equity firm Carlyle Group Inc.,
at about $ 2 billion to $ 3 billion, including debt, they said. There is no guarantee that Syniverse will fetch a listing, either through a SPAC transaction or through a traditional exchange.
Announced by a SPAC, this is the latest in a series of recent deals, as more companies want an alternative to a traditional stock exchange. SPACs are published without business and then seek one to merge with, and the resulting transaction provides a listing to the target.
This is important for Syniverse: the Twilio agreement involves a commercial arrangement that will send a significant amount of business to its side. Syniverse can also use proceeds from a SPAC transaction to make acquisitions.
Syniverse provides roaming, messaging and other telecommunications services to mobile operators and other businesses. It’s been owned by Carlyle since 2011.
Twilio was launched in 2016 and offers a product package aimed at software developers who use their tools to create various services, such as flight delay alerts, secure communication for people who meet via dating sites and platforms to deal with Uber drivers to communicate. Its market value rose to more than $ 67 billion from about $ 15 billion a year ago as the coronavirus pandemic boosted the already growing demand for cloud-based services.
Twilio took advantage of its rising inventory last year by buying customer data firm Segment for about $ 3 billion. Segment provides products that allow companies to collect data from buyers from websites, mobile applications and email.
Private companies flock to specialty procurement firms, or SPACs, to bypass the traditional IPO process and obtain a public listing. WSJ explains why some critics say it is not worth investing in these so-called blank-check businesses. Illustration: Zoë Soriano / WSJ
Salesforce.com Inc.
last year entered into a transaction of approximately $ 27.7 billion to buy Slack Technologies Inc.,
a messaging platform that tries to replace office email. In the wake of the deal, analysts expected more transactions would be deployed in cloud computing as companies run to add features to accommodate all kinds of business remotely and to compete with giant companies, including Microsoft. Corp.
Carlyle agreed to privatize Syniverse in 2010 in a deal worth more than $ 2 billion. In the years that followed, he completed additional acquisitions and rivals Mach and Aicent Inc., respectively. purchased in 2013 and 2014. Syniverse is not seen as a huge success for Carlyle, but the deal with Twilio and a subsequent listing could revive the fate of the deal.
Moelis & Company LLC was financial advisor to Syniverse and Carlyle and Debevoise & Plimpton LLP were legal advisers. Centerview Partners LLC was financial advisor to Twilio and Kirkland & Ellis LLP and DLA Piper LLP were legal advisers.
—Miriam Gottfried contributed to this article.
Write to Cara Lombardo at [email protected] and Dana Cimilluca at [email protected]
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On March 1, 2021, the print edition appears as ‘Twilio wants to help reveal the messages.’