Customer Care

 

West Corporation, a provider of customer care and outsourced communication solutions, has announced an agreement to acquire TeleVox Software, Inc. and CenterPost Communications in separate transactions.

 

Both TeleVox and CenterPost are considered to be fast-growing firms in the notifications market. TeleVox has made its name as a provider of communication and automated messaging services to the healthcare industry. The company focuses on helping its customers to effectively communicate with their patients, reducing no-shows and improving the overall patient experience.

 

CenterPost provides self-service automated notification solutions. Companies using CenterPost applications can communicate with customers via e-mail, fax, wireless text and instant messaging. The company focuses on clients in the pharmaceutical, travel, insurance and financial services industries.

 

One of the bigger attractions for both TeleVox and CenterPost is the ability of both companies to generate high-quality revenue with exceptional visibility. Significant recurring revenue is the result of the multi-year nature of their customer relationships. When both companies are added to West, the organization’s base of clients will be further diversified and will add vital and valuable transactions.

 

Both transactions are expected to close in the first quarter of 2007. The total cost of both transactions before transaction expenses and working capital adjustments is approximately $161 million.

 

West anticipates that automated notifications will represent a market opportunity of over $1 billion by 2009. Though the current market appears to be fragmented with no clear leader, West has made a significant commitment to this market with today’s announcement.  

 

The company recently reported a strong close to 2006. “We are pleased with how we finished the year,” said Thomas B. Barker, chief executive officer of West Corporation, in a statement. “Our 2006 revenue was in line with the updated guidance provided on April 6. The integration of our recent acquisitions is progressing well and we are achieving the synergies we expected.”

 

Elaborating on the acquisitions, Barker went on to add that this market and these two firms are a great fit with the best of West’s strengths. Both businesses revolve around managing voice-oriented transactions and offer a strong recurring revenue model with solid margins. West brings to the table economies of scale, access to critical capital investment and expertise in developing large and successful sales organizations.

 

With the increasing use of mobile communications and instant information access, the demand will continue to grow for automated notifications. Recent research estimates that businesses of all sizes will move more toward self-service applications and virtual brokers and contact centers. As a result, these businesses will need increased notification services. If West can present the products, scalability and systems that these organizations demand, they will be well positioned to dominate the market.

 

 

 

Susan J. Campbell is a contributing editor for TMC (News - Alert) and has also written for eastbiz.com. To see more of her articles, please visit Susan J. Campbell’s columnist page.