Windstream has signed a definitive agreement to acquire Broadview Networks for $227.5 million in cash in an effort to improve its competitiveness in the unified communications market.
The Little Rock, Ark.-based telecom provider expects the acquisition to generate $30 million annually in operating synergies within two years.
"Broadview’s unique, proprietary unified communications solutions will advance our product portfolio, improving our competitiveness and ability to provide enhanced services to business customers. The transaction also will enable us to leverage Broadview’s experienced sales force and cloud operations across our national footprint,” said Tony Thomas, president and CEO of Windstream, in a statement.
Rye Brook, N.Y.-based Broadview specializes in cloud-based unified communications solutions targeting the SMB market with its flagship suite of services, OfficeSuite UC.
The boards of both Broadview and Windstream have already approved the deal unanimously.
"Broadview has been successful transforming its legacy telecom business into a leading provider of unified communications services to businesses that are ready to make the shift to the cloud for their communications services," said Mike Robinson, president and chief executive of Broadview, in a statement. "Windstream’s nationwide footprint, extensive portfolio of service offerings, vast distribution and attractive customer base are a natural fit for our strategic direction. We look forward to combining forces with their team to continue expanding our UCaaS business by delivering best-in-class services to customers across the country."
In March, Broadview boosted its channel presence across the U.S. by adding new channel managers and increasing its partner recruitment efforts. The company hired four new channel managers covering Long Beach, Calif., Seattle, Chicago, and the Northeast.
Windstream plans to close the acquisition in the third quarter of 2017.
Broadview's stock soared 428 percent today to $6.60 per share, while Windstream's stock closed the day unchanged at $5.52.