Twilio will invest up to $ 750 million in Syniverse


Twilio Cloud Communications Company Inc.

TWLO 4.05%

agreed to invest up to $ 750 million in Syniverse Technologies LLC in a precursor to a public listing for the privately owned courier company.

The investment, announced Monday, could be followed in the coming months by a merger between Syniverse and a special-purpose acquisition company, people familiar with the matter said Sunday, when The Wall Street Journal first reported the news. Such a deal could value Syniverse, owned by private equity firm Carlyle Group. Inc.,

at about $ 2 billion to $ 3 billion, including debt, they said. There is no guarantee that Syniverse will achieve a listing, either through a SPAC agreement or a traditional initial public offering.

If made public through a SPAC, it would be the latest in a recent series of such deals as more companies look for an alternative to a traditional IPO. SPACs go public without a business and then look for one to merge with, and the resulting transaction provides the target with a listing.

Crucially for Syniverse, the Twilio deal involves a business deal that would send a significant amount of business its way. Syniverse may also use the proceeds of an agreement with SPAC to make acquisitions.

Syniverse offers roaming, messaging and other telecommunications services for mobile operators and other companies. Since 2011 it has been owned by Carlyle.

Twilio went public in 2016 and offers a suite of products aimed at software developers who use its tools to create various services, such as flight delay alerts, secure communications for people found through dating websites and platforms. to communicate with Uber drivers. Its market value has soared to more than $ 67 billion from around $ 15 billion a year ago when the coronavirus pandemic fueled the already growing demand for cloud-based services.

Last year, Twilio capitalized on its growing stock by buying customer data firm Segment for around $ 3 billion. Segment offers products that allow companies to collect data on website, mobile app and email buyers.

Private companies are turning to Special Purpose Acquisition Companies, or SPACs, to avoid the traditional IPO process and obtain a public listing. WSJ explains why some critics say investing in so-called blank check companies is not worth the risk. Illustration: Zoë Soriano / WSJ

Salesforce.com Inc.

last year reached an agreement of approximately $ 27.7 billion to buy Slack Technologies Inc.,

a messaging platform that has sought to replace office email. In the wake of that transaction, analysts have anticipated more deals in cloud computing as companies compete to add features to suit all types of remote business and to compete with enterprise software giants, including Microsoft. Corp.

Carlyle agreed to take Syniverse privately in 2010 in a deal valued at more than $ 2 billion. In subsequent years, it has completed additional acquisitions, buying rivals Mach and Aicent Inc. in 2013 and 2014, respectively. Syniverse has not been seen as a huge success for Carlyle, but the transaction with Twilio and the subsequent listing could revive the fortunes of the deal.

Moelis & Company LLC was financial advisor to Syniverse and Carlyle and Debevoise & Plimpton LLP were legal advisers. Centerview Partners LLC served as financial advisor to Twilio and Kirkland & Ellis LLP and DLA Piper LLP were legal advisers.

Write to Cara Lombardo at [email protected] and Dana Cimilluca at [email protected]

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It appeared in the March 1, 2021 print edition as ‘Twilio seeks to help make the courier company public’.

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