Cloud communications firm Sinch nabs Inteliquent for $1.14B
Sinch, a cloud communications provider based in Stockholm, is acquiring the US-based voice communications provider Inteliquent for $1.14 billion, the company announced Wednesday. The major acquisition gives Sinch a stronger foothold in the US and puts it in a better position to compete against Twilio.
The deal combines Inteliquent's voice communications businesses, which serve enterprises and telecoms, with Sinch's global messaging services. Sinch will pay the private equity firm GTCR in cash for Inteliquent. The deal is expected to close in the second half of 2021.
Inteliquent has two lines of business: Its Communications Platform as a Service (CPaaS) business includes an API offering for enterprises that want to embed voice calling into their own products or business processes. Its Infrastructure-as-a-Service (IaaS) business provides services for telecoms, such as handling calls to 1-800 numbers.
Both Inteliquent's CPaaS and IaaS businesses leverage the same underlying network. The Chicago-based business runs a carrier-grade tier 1 network that covers 94 percent of the US population. Last year, Inteliquent brought in $533 million in revenue and a gross profit of $256 million.
Sinch, meanwhile, facilitates engagements between consumers and businesses via voice, mobile messaging and video. It has a US headquarters in Atlanta with additional offices in Seattle and San Francisco.
Sinch has been on a buying spree over the past year, spending nearly $1.6 billion on five acquisitions, including Inteliquent. Late last year, Softbank-owned SB Management bought a 10.1 percent stake in the Swedish company, giving it the capital for more acquisitions.
"Becoming a leader in the US voice market is key to establish Sinch as the leading global cloud communications platform," Sinch CEO Oscar Werner said in a statement. "Inteliquent serves the largest and most demanding voice customers in America with superior quality backed by a fully-owned network across the entire US. Our joint strengths in voice and messaging provide a unique position to grow our business and power a superior customer experience for our customers."
The CPaaS market is quickly growing, expected to reach $25 billion by 2025, according to Juniper Research. Sinch's competitors in the market include Twilio, 8x8, Vonage, Nexmo and Bandwidth.