Acquisitions: Lingo Continues SMB and Carrier Rollup Strategy
Lingo Communications, a cloud and managed service provider (MSP) focused on SMB customers, is rolling up carriers through customer and asset buyouts. The latest deal involves an agreement to acquire roughly 4,000 SMB customers from Fusion Connect. Financial terms were not disclosed.
Among the deal highlights that Lingo shared:
- The acquired Fusion SMB customers span 30 states.
- Lingo’s average revenue per user (ARPU) in the SMB sector will rise roughly 10 percent.
- SMB segment gross margin will increase approximately 3 percent.
- Once the businesses are combined 90 percent of revenues will be recurring.
In a prepared statement describing the deal, Lingo Executive Chairman Vincent M. Oddo said:
“This tuck-in acquisition, once closed, will notch another major milestone in Lingo’s previously announced SMB and Carrier rollup strategy.In addition, it will also provide enhanced scale which will enable us to pursue additional value-enhancing initiatives including strategic acquisitions.”
Added Chuck Griffin, president and CEO of Lingo:
“This acquisition is extremely accretive and a very natural fit for Lingo.It will help us achieve the next level of success using the increased scale and resources.”
Lingo Communications: Company Background
Lingo was formed in 2018, when Birch Equity Partners reorganized Birch Communications Holdings into the Lingo business. The company serves all 50 U.S. states, and works closely with Broadsoft and Cisco Systems, among other partners.
Lingo has been active on the M&A front. The company in July 2018 acquired two firms — Impact Acquisition LLC and TNCI Operating Company LLC, collectively known as Impact Telecom. That deal created one of the largest network service providers in North America, the companies said at the time.
Lingo provides IP-based voice, data, network and managed services to 225,000 customers. The company has a nationwide IP-based cloud communications network as well as a North American FG-D network serving many of the largest global Carrier customers.
VoIP Service Provider Mergers and Acquisitions
VoIP and IP telephony services have been stirring M&A activity over the past few years. Among the deals we’ve covered:
- November 2018: Yellowbus Solutions Ltd., a UK-based managed IT and cloud services company, acquired Converged Business Solutions (CBS).
- March 2018: GTT Communications bought Accelerated Connections, a Canadian managed networking, voice-over-IP (VoIP), and colocation services provider.
- September 2017: Pacific Office Automation (POA) acquired Trans-West, a Phoenix, Arizona VoIP and data solutions provider.
- September 2017: Ntiva Inc bought full-service telecom provider IN Communications Inc.
- October 2016: BCM One doubled down on its own voice services, buying CloudStrategies Group.
- September 2016: UK-based Solar Communications acquired TWL Voice and Data Limited.