Cloud communications company Twilio Inc.
TWLO 4.05%
agreed to invest up to $ 750 million in Syniverse Technologies LLC in a forerunner of the privately held courier company’s public listing.
The investment, announced on Monday, could be followed in the coming months by a merger between Syniverse and a special procurement company, people familiar with the matter said on Sunday, when The Wall Street Journal first reported the news. Such a deal could be appreciated by Syniverse, owned by private equity firm Carlyle Group Inc.,
they said about $ 2 billion to $ 3 billion, including debt. There is no guarantee that Syniverse will issue a list, either through a SPAC transaction or through a traditional IPO.
If published through a SPAC, it would be the latest in a recent series of such offers, as more companies are looking for an alternative to a traditional IPO. The SPACs go public without a business and then look for one to merge with, and the resulting transaction gives the target a list.
Essentially for Syniverse, the Twilio agreement involves a trade arrangement that would send a significant amount of business. Syniverse can also use the revenue from a SPAC business to make purchases.
Syniverse provides roaming, messaging and other telecommunications services to mobile operators and other companies. It has been owned by Carlyle since 2011.
Twilio went public in 2016 and offers a suite of products for software developers who use their tools to create various services, such as flight delay alerts, secure communications for people who meet through dating sites and platforms. for communicating with Uber drivers. Its market value has risen to more than $ 67 billion from about $ 15 billion a year ago as the coronavirus pandemic has boosted already growing demand for cloud-based services.
Last year, Twilio took advantage of its growing stock by buying Segment for customers for about $ 3 billion. Segment offers products that allow companies to collect data about buyers from websites, mobile apps and email.
Private companies are flooding special purpose procurement companies or SPACs, to bypass the traditional IPO process and get a public listing. The WSJ explains why some critics say that investing in these so-called worthless companies is not worth the risk. Illustration: Zoë Soriano / WSJ
Salesforce.com Inc.
last year it signed a contract worth about $ 27.7 billion to buy Slack Technologies Inc.,
a messaging platform that sought to replace office email. Following that transaction, analysts anticipated more offers in cloud computing as companies struggled to add features to host all types of remote businesses and compete with business software giants, including Microsoft. Body.
Carlyle agreed to give up Syniverse in 2010, in a business valued at over $ 2 billion. In the years that followed, he completed additional acquisitions, buying rivals Mach and Aicent Inc. in 2013 and 2014, respectively. Syniverse was not seen as a great success for Carlyle, but the transaction with Twilio and a subsequent listing could revive the transaction’s fortune.
Moelis & Company LLC was a financial advisor to Syniverse, and Carlyle and Debevoise & Plimpton LLP were legal advisers. Centerview Partners LLC was a 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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It appeared in the print edition of March 1, 2021 under the name “Twilio seems to help advertise courier companies.”