CSG Systems International, Inc., announced today the $19 million cash acquisition of Ascade, an independent Swedish software company providing trading and routing software solutions to telecommunications companies globally.
CSG provides software- and services-based business support solutions that help clients generate revenue and maximize customer and partner relationships. With Ascade's trading and routing solution, Ascade7, and CSG Wholesale Business Management Solution (WBMS), CSG feels it has firmly established its global leadership position in the telecommunications wholesale marketplace.
Peter Kalan, president and CEO of CSG , said the acquisition and the combined offerings that result, as well as its global presence ensures that operators of all types - fixed, mobile, wholesale, broadband, MVNOs and ISPs - have a partner in CSG with the breadth of functionality and flexibility in delivery models to meet their current and evolving wholesale needs.
With the number of VoIP carriers growing along with the number of wholesale relationships with third-party content owners, CSG's product portfolio provides them with increasing automation and assurance for both their retail and wholesale revenue streams.
"For many carriers, their wholesale business has always represented a significant component of their overall revenue. As their business models evolve to address growth in areas such as digital content and M2M services, the wholesale component becomes more complex," said Karl Whitelock, director of OSS/BSS Strategy, Stratecast | Frost & Sullivan. "This means communications service providers are increasingly looking for sophisticated, scalable technologies that can deliver wholesale transactions with accuracy, timeliness, and with a high level of service quality."
The approximate $19 million purchase price translates into a revenue multiple of approximately 1.2 times 2011 Ascade revenues and approximately 16 times 2011 EBITDA (earnings before interest, taxes, depreciation and amortization).
The acquisition closed on July 13th. CSG is not updating its 2012 financial guidance today to include the impact of the closing of the Ascade acquisition. CSG will provide updated 2012 non-GAAP financial guidance to reflect the impact of the acquisition on its regularly scheduled Q2 2012 earnings call on August 7, 2012.