ATLANTA, GA – 02-12-2019 (PRDistribution.com) — Transaction adds SMB scale to Lingo while increasing ARPU and Gross Margin
Lingo Communications, LLC (“Lingo”), a leading global cloud and managed service provider dedicated to serving the SMB, Carrier and Consumer markets, announced today that on February 4, 2019 it entered into a definitive agreement to acquire select SMB customer assets from Fusion Connect, Inc. (“Fusion”), in an all-cash transaction.Lingo Highlights:
- Lingo to acquire select Fusion SMB customers located in 30 states. The final closing is expected in Q2 ’19 following customer and regulatory notifications.
- Will add approximately 4,000 customers to Lingo’s high growth SMB segment; will increase SMB segment ARPU by approximately 10%; and will increase SMB segment gross margin by approximately 3%.
- Expected to be significantly accretive to Lingo’s Adjusted EBITDA immediately upon closing, leading to approximately $28 million in annual pro forma unlevered free cash flow in 2019.
Lingo will continue to operate its nationwide cloud communications network as well as its North American FG-D network focused exclusively on the SMB, Carrier and Consumer markets. The combined customer base demonstrates strong fundamentals, with monthly recurring revenue comprising approximately 90% of total revenue and a churn rate below the industry average. In addition, the combined company will enjoy significant opportunities for growth by cross-selling and up-selling these customers.
“This tuck-in acquisition, once closed, will notch another major milestone in Lingo’s previously announced SMB and Carrier roll-up strategy. In addition, it will also provide an enhanced scale which will enable us to pursue additional value-enhancing initiatives including strategic acquisitions”, said Vincent M. Oddo, Executive Chairman of Lingo.
“This acquisition is extremely accretive and a very natural fit for Lingo. It will help us achieve the next level of success using the increased scale and resources,” said Chuck Griffin, President & CEO of Lingo.
Macquarie Capital served as financial advisor to Lingo. Jones Day and Cahill Gordon & Reindel served as legal advisors to Lingo.
Lingo is a leading global cloud and managed service provider to the SMB, Carrier and Consumer markets. Lingo provides modern, efficient, IP-based voice, data, network services, and managed services to customers around the globe. Lingo serves 225,000 customers and maintains both a nationwide IP-based cloud communications network as well as a North American FG-D network serving many of the largest global Carrier customers. Lingo also has a very experienced leadership team and is proud to provide exceptional 365/7/24 customer care. For additional information, please visit lingo.com.
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