Canadian unified communications-as-a-service (UCaaS) business Sangoma Technologies Corporation has acquired NetFortis Corporation from private equity firm Spire Capital. The purchase price: $68 million to $80 million, depending on various earn-out targets.
NetFortis generates about $50 million in annual revenue, so the deal's valuation is roughly 1.36X to 1.6X annual revenues.
This is technology M&A deal number 315 that ChannelE2E has covered so far in 2022.
NetFortris of Plano, Texas, provides UCaaS and cloud-based, fully managed MSP solutions for businesses of all sizes. The company has approximately 250 employees and additional offices in Dallas, Seattle, Los Angeles and Manila.
The acquisition will bolster Sangoma’s SaaS communications business and extend its suite of cloud services with new MSP capabilities, according to the buyer. The deal also opens up potential new M&A opportunities, Sangoma said.
Meanwhile, NetFortis also has M&A experience. The company acquired Fonality, another UCaaS provider, in February 2017.
Sangoma Acquires Netfortis: Executive Insight
Bill Wignall, president and CEO, Sangoma, commented:
“A critical part of our existing strategy, and of our competitive differentiation, involves providing customers with the widest set of cloud communications services in our industry, avoiding the need for them to buy five different services from five different vendors. The acquisition of NetFortris further extends that strategy in such a perfectly natural manner. Not only can customers already get from Sangoma all the ‘aaS’ products they use today, but now they will also be able to obtain all the other cloud-based MSP services they know they need, such as managed network security, managed access, and managed SD-WAN. This truly is ‘one stop shopping’ for our customers, and it taps into that very important new trend that so many of us in the industry see starting to emerge. I am most excited about this acquisition, our eleventh in eleven years, because it demonstrates our innovative, unique, forward-looking vision and it continues to push Sangoma ahead in the market, further differentiating us from the competition.”
Sangoma’s M&A Experience
Sangoma has M&A experience.. In February 2021, the company acquired cloud communications services and software company Star2Star for roughly US$437 million. Sangoma also acquired Digium in August 2018.
On this most recent deal, INFOR Financial Inc. served as financial advisor to Sangoma and Norton Rose Fulbright US LLP and Norton Rose Fulbright Canada LLP are acting as U.S. and Canadian legal counsel to Sangoma. Q Advisors LLC is serving as financial advisor to NetFortris and Dentons LLP are acting as U.S. and Canadian legal counsel to NetFortris.
