Seeking to strengthen its technology portfolio in the small business space, consumer electronics retailer Best Buy Co. Inc. has agreed to acquire broadband service provider Speakeasy (News - Alert) Inc. for $97 million.
Under the deal, Speakeasy would become a wholly owned subsidiary of Best Buy once the transaction closes. Best Buy expects the transaction to be neutral to fiscal 2008 earnings. Speakeasy's calendar year 2006 revenue was $80 million.
Although Best Buy is known primarily as a consumer electronics retailer, the company is trying to grow its Best Busy For Business unit, likely to help the company offset fierce competition and falling prices in consumer electronics. Two of Best Buy’s competitors, CompUSA and Circuit City, have announced over the past month they would close a number of stores in response to poor earnings and competition from both brick-and-mortar and online retailers.
"Best Buy For Business is all about helping small businesses grow or operate more efficiently through technology. By joining forces with Speakeasy, a company with a true passion for helping entrepreneurs run their businesses, we are making technology more accessible to small businesses by creating a single source for their IT needs," said Darren Jackson, Best Buy executive vice president and CFO, in a statement. “With Speakeasy in our portfolio, we are better equipped to provide our small business customers with one-stop shopping for all of their technology needs.”
In 1994, Speakeasy opened in Seattle as one of the nation's first Internet cafes and now offers a full range of innovative voice and data solutions to help small businesses improve their productivity and cut costs. Speakeasy services include business class broadband and VoIP . The company operates in most metropolitan areas within the 48 contiguous United States.
Speakeasy employs about 300 people and had over 40,000 customers in 2006.
Bruce Chatterley, the company's CEO, plans to continue in his current role upon the close of the acquisition and will report to David Hemler, vice president, who oversees Best Buy For Business. The entire Speakeasy executive team is expected to remain with the company.
"This is an exciting new chapter for Speakeasy," said Chatterley in a statement. "By joining with Best Buy For Business, we aim to become the champion for small business IT and communications solutions, simplifying technology, making it accessible, and improving business performance."
Want more wireless news? Check out TMCnet’s complete coverage of the CTIA Wireless (News - Alert) show (March 27-29, 2007) here.
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Spencer Chin is a contributing editor for TMCnet. To see more of his articles, please visit his columnist page.
Voice over IP (VoIP) | X | | A real-time communications system that converts voice into digital packets containing media and signaling data that travel over networks using Internet Protocol....more |
Internet Protocol (IP) | X | | IP stands for Internet Protocol, a data-networking protocol developed throughout the 1980s. It is the established standard protocol for transmitting and receiving data
in packets over the Internet. I...more |
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