TELUS Corporation announces agreement to acquire Lionbridge AI through TELUS International
November 06 2020 - 6:42AM
Today, TELUS Corporation (T-TSX; NYSE-TU), announced that TELUS
International, a digital customer experience (CX) innovator that
designs, builds and delivers next-generation solutions for global
and disruptive brands, has entered into an agreement to acquire
Lionbridge AI, a market-leading global provider of crowd-based
training data and annotation platform solutions used in the
development of AI algorithms to power machine learning. The
acquisition will be at a purchase price of approximately C$1.2
billion (approximately US$935 million) consisting of debt and
equity, subject to customary closing adjustments. Closing is
expected to occur on December 31, 2020.
“Today’s announcement advances TELUS’ commitment to harness the
power of technology to provide outstanding customer experiences on
a global basis, while accelerating the digital transformation and
strategic growth journey of TELUS International. The acquisition
will add key capabilities and diversity to TELUS International’s
suite of next-generation digital solutions consistent with the
ongoing execution of its growth agenda. We continue to move forward
with our plans for the TELUS International IPO, which is targeted
for the first quarter of 2021,” said Darren Entwistle, President
and CEO of TELUS. “We look forward to welcoming Lionbridge AI’s
skilled team members to the TELUS family as we continue to elevate
our world-leading customer experience and innovative technologies
for the valued brands we partner with around the world.”
“With the addition of Lionbridge AI, TELUS International will
further progress its penetration of the fast-growing new economy
services market that will enable our team to support important AI
applications as demand for high-quality, multilingual data
annotation continues to increase,” continued Entwistle. “As a
unified team and company, we will be strongly positioned to meet
the end-to-end needs of today’s technology hyperscalers and
industry disruptors in machine learning and AI systems to develop
smarter products and services, and deliver exceptional customer
experiences.” As a division of Lionbridge Technologies, Inc. - a
privately-held company with more than 20 years of industry
experience - Lionbridge AI is one of only two globally-scaled,
managed training data and data annotation services providers in the
world. Data annotation is the essential process of labeling data to
make it usable for AI systems, and Lionbridge AI annotates data in
text, images, videos, and audio in more than 300 languages and
dialects for some of the world’s largest technology companies in
social media, search, retail and mobile. Headquartered in Waltham,
Massachusetts, Lionbridge AI has more than 750 employees working
from countries around the world, including in the US, Ireland,
Finland, India, UK, Japan, Denmark, Costa Rica and South Korea.
Lionbridge AI has also developed a proprietary data
annotation platform that is used in combination with a crowdsourced
community of more than one million professional annotators,
qualified linguists and in-country language speakers across six
continents. There are between 30,000-50,000 members of this
advanced community of global crowd contributors deployed at any one
point in time.
Lionbridge AI has demonstrated strong financial growth,
reporting 2019 revenue of approximately C$260 million, which is up
29 per cent year over year, and an EBITDA margin consistent with
TELUS International’s within the range of 20 to 25 per cent.
Lionbridge AI’s financial performance is underpinned by an
attractive business model, long-term client relationships averaging
15 years among its top five clients, and a growing market demand
for data annotation services to support the overall increased
investment in AI and machine learning. Lionbridge AI has been
resilient in the face of COVID-19, and for the nine-month period
ending September 30, 2020, the company generated approximately
C$230 million in revenue, up from approximately C$190 million in
the same period a year ago. Capital intensity for Lionbridge AI is
in the low single digits, driving a high simple free cash flow
conversion.
“We are thrilled to be joining the TELUS International team as
we share a like-minded commitment to innovating for our clients and
a focus on our people whom we consider to be unique experts in our
industry and a sustainable source of competitive advantage,” said
Ed Jay, President of Lionbridge AI. “We are looking forward to
working together with TELUS International to continue delivering
the most valuable AI training data and platform for our clients,
and to build upon the scale and momentum we have achieved through
our crowd of contributors spanning diverse languages, cultures and
geographies.”
The acquisition of Lionbridge AI will be financed from TELUS
International’s non-recourse credit facilities and funds from an
additional equity capital contribution from TELUS Corporation and
funds affiliated with Baring Private Equity Asia. The acquisition
is subject to customary closing conditions and regulatory
approvals.
About TELUS TELUS (TSX: T, NYSE:
TU) is a dynamic, world-leading communications and information
technology company with $15 billion in annual revenue and 15.4
million customer connections spanning wireless, data, IP, voice,
television, entertainment, video and security. At TELUS, we
leverage our world-leading technology’s potential to enable
remarkable human outcomes. Our long-standing commitment to putting
customers first fuels every aspect of our business, making us a
distinct leader in customer service excellence and loyalty. TELUS
Health is Canada’s largest healthcare IT provider, and TELUS
International delivers the most innovative business process
solutions to some of the world’s most established brands. Driven by
our passionate social purpose to connect all Canadians for good,
our deeply meaningful and enduring philosophy to give where we live
has inspired our team members and retirees to contribute more than
$736 million and 1.4 million days of service since 2000. This
unprecedented generosity and unparalleled volunteerism have made
TELUS the most giving company in the world. For more information
about TELUS, please visit telus.com, follow us @TELUSNews on
Twitter and @Darren_Entwistle on Instagram. Forward-looking
statements: This news release contains statements about
expected future events, including statements relating to the
planned acquisition of Lionbridge AI by TELUS International, the
expected timing of the transaction, the expected benefits of the
transaction and plans for its integration. By their nature,
forward-looking statements require TELUS to make assumptions and
predictions and are subject to inherent risks and uncertainties.
There can be no assurance that the acquisition will be completed as
expected or upon the terms and conditions described in this news
release, that required regulatory approvals will be obtained, or
that the expected financial results or the expected benefits of the
transaction will be realized. There is significant risk that the
forward-looking statements will not prove to be accurate. The
forward-looking statements contained in this news release describe
our expectations at the date of this news release and, accordingly,
are subject to change after such date. Readers are cautioned not to
place undue reliance on forward-looking statements as a number of
factors could cause actual future events to differ materially from
those expressed in the forward-looking statements. Accordingly,
this news release is subject to the disclaimer and qualified by the
assumptions, qualifications and risk factors referred to in TELUS'
2020 third quarter management’s discussion and analysis and 2019
annual report, and in other TELUS public disclosure documents and
filings with securities commissions in Canada (on SEDAR at
sedar.com) and in the United States (on EDGAR at sec.gov). Except
as required by law, TELUS disclaims any intention or obligation to
update or revise forward-looking statements.
Media Contacts: TELUS Media
RelationsJacinthe Beaulieu (418) 318-6102
jacinthe.beaulieu@telus.com
TELUS Investor RelationsIan McMillan(604)
695-4539ir@telus.com
Photos accompanying this announcement are available at
:https://www.globenewswire.com/NewsRoom/AttachmentNg/b5e847a6-3564-403f-90d5-e279ad64a1cchttps://www.globenewswire.com/NewsRoom/AttachmentNg/36521cb9-53e9-4282-adc8-eaf8cec47be5
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