Extensive cloud coverage may not sound appealing when it comes to the weather, but in the technological world, expanding cloud coverage is great news. And for 8x8 (News - Alert), a cloud communications and collaboration solutions provider, expansion is the word of the week. On Monday, November 11, the company announced that it will be acquiring Voicenet Solutions (News - Alert), a privately-held provider of cloud business telephony and communications services in the United Kingdom, for $18.4 million in cash. Up until now, 8x8 has focused primarily on offering services in North America, making this deal part of the company’s first big plunge into European and international markets in an effort to move the company upmarket.
Voicenet Solutions, which has been an influential player in the U.K. market since 2004, is a good match for 8x8. Voicenet provides small- to medium-sized businesses (SMBs) with hosted and cloud-based VoIP and unified communications services. Specifically, its services include fixed mobile convergence applications that make desktop business phone solutions available on clients’ smartphones. The deal is set to benefit both companies, which will improve services for Voicenet’s 1,000-plus clients as well as the more than 35,000 business customers currently with 8x8.
According to Vik Verma, chief executive officer of 8x8, "This acquisition provides 8x8 an operational presence in Europe to support our U.S. customers with multinational offices and at the same time enables Voicenet to market a broader range of services to its installed base of customers. We look forward to welcoming our new Voicenet employees to 8x8 and providing their U.K. customers with our comprehensive, secure and reliable cloud communications and collaboration services."
It’s been a strong week for 8x8, as the company was also just named in Gartner's (News - Alert){C} Leaders Quadrant for unified communications-as-a-service (UCaaS) for the second consecutive year. Coinciding with the announcement of the acquisition agreement, 8x8 additionally announced a 12.5 million-share stock offering, which at current levels, would yield proceeds of roughly $120 million. However, the company remains mum on its plans for where those proceeds will go.
While representatives at 8x8 were not available for immediate comment, Peter Bernstein, senior editor and industry expert at TMC (News - Alert), weighed in on the deal with Voicenet: “Hosted and cloud-based communications provide customers with unique services everywhere, every time, and with all the capabilities. They also offer hosted service providers the ability to provide growing companies with globally distributed offices with a full suite of capabilities that know no boundaries. However, providing worldwide service but maintaining local customer intimacy remains critical. 8x8’s acquisition of Voicenet Solutions represents the way cloud-based solutions providers can expand their footprints in general, as well as serve the needs of customers who themselves are growing and going global.”
The Voicenet acquisition, which is subject to customary closing conditions, is expected to close before the end of the calendar year.
Edited by Blaise McNamee