Ericsson to acquire cloud-based communications provider Vonage

November 22, 2021 // By Jean-Pierre Joosting
Ericsson to acquire cloud-based communications provider Vonage
USD 6.2 billion acquisition to spearhead the creation of a global network and communications platform for open innovation

Ericsson has entered into an agreement to acquire global communications provider Vonage Holdings for USD 21 per share, representing a total acquisition price of approximately USD 6.2 billion (Enterprise Value).  

Approved unanimously by the Board of Vonage, the transaction builds upon Ericsson's stated intent to expand globally in wireless enterprise, offering existing customers an increased share of a market valued at USD 700 billion by 2030. For Ericsson, the acquisition builds on the success of the integration of Cradlepoint in September 2020. Cradlepoint has continued to develop strongly under Ericsson's ownership.

The cloud-based Vonage Communications Platform (VCP) serves over 120,000 customers and more than one million registered developers globally. The API (Application Programming Interface) platform within VCP allows developers to embed high quality communications — including messaging, voice and video — into applications and products, without back-end infrastructure or interfaces. Vonage also provides Unified Communications as a Service (UCaaS) and Contact Center as a Service (CCaaS) as part of the Vonage Communications Platform.

VCP accounts for approximately 80% of Vonage's current revenues and delivered revenue growth in excess of 20% in the three-year period to 2020, with adjusted EBITDA margins moving from -19% in 2018 to break-even in the 12-month period to 30 September 2021. Vonage's management team projects annual growth of over 20% for VCP in the coming years.

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