The latest gossip coming from the UC&C rumour mill suggests that 8×8 might be looking for a buyer. At least, that’s according to information released by “StreetInsider.com“. So far, there’s been no official comment on that speculation from the UCaaS management team after other companies have reached out asking for updates about a potential sale.
It’s probably worth noting, to begin with, that this isn’t the first time a speculation of this nature has arisen in regards to 8×8. In fact, a similar story arose last year, during December. Elka Popova, an analyst from Frost & Sullivan UC noted that the last time she had heard a rumour regarding sales for 8×8, it had been considered a one-off offering. Now, it seems that the article from StreetInsider.com is suggesting that 8×8 is truly looking for a buyer in earnest.
What’s the Story for 8×8?
StreetInsider.com cited “people familiar” with the case when reporting that 8×8 had retained Morgan Stanley while fielding interest from private equity firms and other companies. Additionally, the article indicates that the UCaaS providers are looking for a way to scale, and the best way for them to achieve that would generally be through acquisitions and mergers. Recent examples of this can be seen in the announcement by NetFortris regarding its acquisition of Fonality, and the move made by TelePacific last year to purchase DSCI.
Mergers and Acquisitions can provide a host of benefits to companies, including technology know-how, sheer size expansion, geographic expansion, market share and more. Depending on the vision for growth, providers can engage in mergers and acquisitions on a vertical, international, or domestic basis. An M&A might even be used for founders looking to move into other projects.
8×8 Is Ready to Grow
At this stage, we can see that 8×8 is standing on solid financial platforms, which makes it a great acquisition target. For instance, in its most recent filing, 8×8 reported that its service revenue had grown by 23% year over year to $60.1 million, with a complete revenue of $63.7 million at a year over year growth of 20%.
Additionally, 8×8 may be seductive to some buyers because it’s using its technology it crafted itself, which means that it has more control over variable costs, and limited need to depend on third-party solutions for innovation. In terms of contact centre solutions and UCC, it’s created a diverse international presence and partner ecosystem, and holds one of the largest shares in the current market – all keys for success in UCaaS.
Though previously, Elka Popova had indicated that 8×8 could be a good fit for a PBX vendor that hasn’t yet created a strong UCaaS portfolio, she now suggests that 8×8 may be better for a SaaS company who wants to add real-time communications to its portfolio.
Related:
Exploring the 27% Growth of 8×8 in 2016
