The combination puts Kaleyra among the top-5 global CPaaS
platforms with strong positions in the Americas, Europe, and APAC.
On a pro forma basis, the existing North American customer base
will be approximately 30% of 2021 revenue.
Kaleyra, Inc. (NYSE: KLR) (KLR WS) (“Kaleyra” or the “Company”),
a rapidly growing cloud communications software provider delivering
a secure system of application programming interfaces (APIs) and
connectivity solutions in the API/Communications Platform as a
Service (CPaaS) market, today announced that it has closed the
previously announced transaction under which Kaleyra would acquire
mGage, a leading global mobile messaging provider, for $215 million
in cash and Kaleyra common stock.
mGage is a best-of-breed, Tier 1 aggregator, enabling a diverse
range of enterprise to effectively engage with their customers
leveraging the power of mobile messaging across a variety of use
cases. mGage serves its customers through its enterprise-grade,
cloud-based campaign management platform, Communicate Pro, and its
API solution, Connect to provide mobile messaging across multiple
channels such as SMS, MMS, Push, and RCS.
“We are excited to have closed the mGage transaction and look
forward to competing globally as a combined entity. This
acquisition redefines Kaleyra by uniting two world-class enterprise
cloud communications companies, creating a top-5 global CPaaS
platform with a global footprint of diversified and balanced
products,” commented Dario Calogero, Kaleyra’s Founder and Chief
Executive Officer. “This combination will accelerate and expand
Kaleyra’s opportunity to serve the CPaaS market which is expected
to reach $26 billion in 2025 with a compound annual growth rate of
35%1 and the broader A2P Enterprise messaging market which is
expected to reach $78 billion in 2022.2”
This combination provides multiple benefits to Kaleyra’s
customers.
Kaleyra will expand its network operator connections, which
already cover more than 190 countries, and become one of only four
companies providing direct connectivity to all US carriers. These
enhanced global connections position Kaleyra as a stronger player
in the messaging arena and provide significant cost synergies
From a go-to-market perspective, this acquisition is perfectly
aligned with Kaleyra’s history of focused and disciplined
acquisitions. This transaction makes Kaleyra a geographically
balanced CPaaS company and vastly expands its existing US customer
base to 31% of revenues on a pro forma basis.
The combination expands Kaleyra’s R&D footprint and
strengthens its messaging portfolio with Google RCS/RBM while also
enriching its offering of Enterprise Communication Analytics and
Omnichannel Engagement Services. Kaleyra and mGage’s messaging
portfolios are highly complementary and provide for immediate
cross-selling opportunities across the existing combined customer
base of over 3,800 customers.
Financial Outlook
Kaleyra expects mGage’s first month of results to have the
following contribution to its financial outlook for the second
quarter 2021, also provided on May 10, 2021:
- Second Quarter 2021 Guidance: Increase the revenue range by $10
- $11 million to $50.0 - $51.0 million.
Acquisition Details
Kaleyra acquired mGage for a total purchase price of
approximately $215 million. mGage shareholders received cash in the
amount of $195 million and 1,600,000 shares of Kaleyra common
stock. In a related transaction, Kaleyra raised $200 million in
senior unsecured convertible notes and sold 8,400,000 shares of
common stock in a PIPE offering.
About Kaleyra Inc.
Kaleyra, Inc. (NYSE American: KLR) (KLR WS), is a global group
providing mobile communication services to financial institutions,
e.commerce, digital giants, software companies, logistic providers,
healthcare and other large organizations worldwide. Through its
proprietary platform, Kaleyra manages multi-channel integrated
communication services on a global scale, consisting of messaging
and instant messaging, push notifications, e-mail, voice services,
and chatbots. Kaleyra’s technology today makes it possible to
safely and securely manage billions of messages monthly with a
reach to hundreds of MNOs including all tier-1 US carriers. For
more information: https://www.kaleyra.com/.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, including with respect to the anticipated benefits of the
acquisition of mGage by the Company, including the Company’s
projected future results and market opportunities following the
acquisition of mGage. These forward-looking statements generally
are identified by the words “believe,” “project,” “expect,”
“anticipate,” “estimate,” “intend,” “strategy,” “future,”
“opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,”
“will continue,” “will likely result,” and similar expressions.
Forward-looking statements are predictions, projections and other
statements about future events that are based on current
expectations and assumptions and, as a result, are subject to risks
and uncertainties. Many factors could cause actual future events to
differ materially from the forward-looking statements in this press
release, including but not limited to: (i) risks that the
transaction disrupts current plans and operations of mGage and
potential difficulties in mGage employee retention as a result of
the transaction, (ii) the price of the Company’s securities may be
volatile due to a variety of factors, including changes in the
competitive and highly regulated industries in which the Company,
including mGage, operates, variations in operating performance
across competitors, changes in laws and regulations affecting the
Company’s, including mGage’s, business and changes in the combined
capital structure, (iii) the ability to implement business plans,
forecasts, and other expectations after the completion of the
transaction, and identify and realize additional opportunities,
(iv) the risk of downturns and a changing regulatory landscape in
the highly competitive communications industry and (v) the size and
growth of the market in which the Company operates, (vi) the mix of
services utilized by the Company’s customers and such customers’
needs for these services, (viii) market acceptance of new service
offerings, (ix) the ability of the Company to expand what it does
for existing customers as well as to add new customers, (x) that
the Company will have sufficient capital to operate as anticipated,
and (xi) the impact that the novel coronavirus and the illness,
COVID-19, that it causes, as well as governmental responses to deal
with the spread of this illness and the reopening of economies that
have been closed as part of these responses, may have on the
Company’s operations, the demand for its products, global supply
chains and economic activity in general. The foregoing list of
factors is not exhaustive. You should carefully consider the
foregoing factors and the other risks and uncertainties described
in the “Risk Factors” section of the Company’s Annual Report on
Form 10-K for the year ended December 31, 2019, the Company’s
Quarterly Report on Form 10-Q for the quarter ended March 31, 2021
and other documents filed by the Company from time to time with the
U.S. Securities and Exchange Commission (the “SEC”). These filings
identify and address other important risks and uncertainties that
could cause actual events and results to differ materially from
those contained in the forward-looking statements. Forward-looking
statements speak only as of the date they are made. Should one or
more of these risks or uncertainties materialize or should any of
the assumptions being made prove incorrect, actual results may vary
in material respects from those projected in these forward-looking
statements. Readers are cautioned not to put undue reliance on
forward-looking statements. We undertake no obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required
under applicable securities laws.
1 Juniper Research, 2020 2 Statista, 2021
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version on businesswire.com: https://www.businesswire.com/news/home/20210601006045/en/
Investor Contact: Marc P. Griffin ICR, Inc.
Marc.Griffin@icrinc.com ir@kaleyra.com 646-277-1290
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