Sangoma Seals Deal with Board of Directors for Star2Star Acquisition

Canadian cloud-based CaaS solutions provider Sangoma has secured permission from the company’s board to proceed with the acquisition of StarBlue Inc., otherwise known as Star2Star Communications. Assuming Sangoma stockholders also approve of this deal, Star2Star will be purchased for roughly $437million, consisting of US$105 million in cash and 110 million common shares of Sangoma.

Star2Star is a privately held provider of cloud communication services, and specifically targets mid-size and enterprise sized customers. Both Sangoma and Star2Star have a deep understanding of cloud technologies,and  the combination of talents will help the company strive toward its goal of creating a complete, fully integrated suite of cloud solutions. The acquisition will also help Sangoma to expand on an international scale, using Star2Star’s cloud native solutions in countries where competition is minimal.

 “We are thrilled to combine forces with Sangoma because we have so many complementary strengths,” said Norman Worthington, founder and CEO at Star2Star.“Sangoma was the perfect fit for us because they identified and appreciated our talented team, loyal customers and unique go to market approach.”

The company had an impressive revenue haul over the past 12 months, due to the overwhelming demand of cloud products and services due to the pandemic. Star2Star brought in approximately $107 million in 2020, with over 80% of those funds being recurring. Cloud-based services have skyrocketed in demand in recent months, and the trend will likely continue for some time as companies adapt to the evolving business landscape.

“This transaction ensures we can meet any customer’s preference, be it for purely cloud solutions, or for on-premise deployments, or a hybrid combination, all the way from small businesses to large enterprises.” added Bill Wignall, President and CEO of Sangoma.“For many years, we have consciously pursued a strategy to transform Sangoma from a product business to one of the communications industry’s leading SaaS companies. This deal is incredibly exciting not only because it will generate scale in a growing, consolidating space, but also because by combining with Star2Star we will have completed our long-term evolution into a leading cloud services company.”

Edited by Maurice Nagle