Stock Monitor: Telephone and Data Systems Post Earnings Reporting
LONDON, UK / ACCESSWIRE / May 14, 2018 / If you want access to our free research report on Fusion Telecommunications International, Inc. (NASDAQ: FSNN) (''Fusion''), all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=FSNN as the Company's latest news hit the wire. On May 10, 2018, the Company announced that it has inked a deal to acquire MegaPath Holding Corp. (''MegaPath''), which is a provider of robust, fully-integrated suite of cloud services, for approximately $71.5 million. Register today and get access to over 1,000 Free Research Reports by joining our site below:
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Active-Investors.com is focused on giving you timely information and the inside line on companies that matter to you. This morning, Fusion Telecommunications International most recent news is on our radar and our team decided to put out a fantastic report on the company that is now available for free below:
- Up to $10.0 million of the price consideration is payable at Fusion's election in unregistered shares of Fusion common stock, which are priced at $5.78 per share.
- The deal's valuation is approximately 5 times pro-forma adjusted EBITDA.
- The Company will fund the cash portion of the consideration via borrowings under its First Lien Senior Secured Credit Facility, $62.0 million of which is currently held in escrow for this acquisition.
- The transaction, likely to close within the next 90 days, is subject to the receipt of certain regulatory approvals and other customary closing conditions.
The transaction contributes additional financial scale to Fusion's earnings, with approximately $70 million in annual revenue; 95% of which consists of contracted monthly recurring revenue (MRR), and adjusted EBITDA of approximately $15 million including anticipated cost synergies. The acquisition results in the addition of more than 8,000 small and medium business and large enterprise customers, with an average monthly revenue per customer (ARPU) of $750 and 1.0% monthly churn. It also adds around 45 quota-bearing sales representatives across direct and indirect sales channels, as well as a number of distribution partners, driving upselling and cross-selling opportunities and deepening Fusion's strong relationships throughout the Channel Partner sales channel.
MegaPath is an Ideal Fit with Fusion's Strategic Objectives as it Adds a Diverse, High-Value Business Customer Base
Matthew Rosen, Chairman and Chief Executive Officer (CEO) of Fusion, stated that this transaction is further evidence that Fusion is rapidly building a cloud services industry leader around its unique and compelling single-source strategy. MegaPath is an ideal fit with Fusion's strategic objectives as it adds a diverse, high-value business customer base; a team of cloud services experts; and an incremental financial scale, with a high percentage of MRR, high ARPU, and a low churn relative to industry averages. Rosen added that given the similarities between the businesses, the Company expects the MegaPath acquisition to facilitate the customer, operational, and financial integration of Birch, which was recently acquired, enabling it to drive its strategy more efficiently across the entire organization.
Combination of the Two Companies will Create Significant Value for Shareholders
Commenting on the acquisition, Craig Young, CEO of MegaPath, stated that Fusion's differentiated strategy, its high-quality integrated product suite, and its scalable platform are a natural fit with MegaPath's business and culture. MegaPath's participation in the equity of Fusion through this transaction underscores its confidence that the combination of the two Companies will create significant value for shareholders. Young added that MegaPath's customers will continue to benefit from the same high levels of service quality, customer care, and innovation from Fusion that they have come to expect from the Company.
Fusion's Recent Acquisition
On May 07, 2018, the Company closed its previously-announced acquisition of the Cloud and Business Services unit of Birch Communications Holdings, Inc (''Birch''). The acquisition was completed through a merger of a wholly-owned subsidiary of Fusion with and into Birch. The total enterprise value of this transaction was approximately $600 million, consisting of approximately 50 million shares of Fusion common stock and the refinancing of $444 million of Birch's indebtedness. The Birch acquisition was financed through borrowings under Fusion's new $680 million Senior Secured Credit Facilities, which included $640 million in term loans and a $40 million revolving credit facility.
About MegaPath Holding Corp.
Established in 1996 and headquartered in Pleasanton, California, MegaPath is a cloud communications and connectivity organization that empowers businesses to easily and securely communicate between their headquarters, employees, and business partners. MegaPath offers a comprehensive portfolio of Business Voice, Unified Communications, Business Internet, Private Networking, and Security Services.
About Fusion Telecommunications International, Inc.
Founded in 1997 and headquartered in New York City, New York, Fusion delivers a comprehensive suite of innovative, yet proven cloud solutions to businesses of all sizes. The Company's advanced, high availability service platform enables the integration of leading edge solutions in the cloud, including cloud communications, cloud connectivity, cloud computing, and additional cloud services such as storage and security.
Stock Performance Snapshot
May 11, 2018 - At Friday's closing bell, Fusion Telecommunications International's stock rose 1.08%, ending the trading session at $5.59.
Volume traded for the day: 254.08 thousand shares, which was above the 3-month average volume of 223.38 thousand shares.
Stock performance in the last month - up 10.91%; previous three-month period - up 26.76%; past six-month period - up 54.63%; and past twelve-month period - up 138.87%
After last Friday's close, Fusion Telecommunications International's market cap was at $183.58 million.
The stock is part of the Technology sector, categorized under the Wireless Communications industry.
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