NEW YORK, NY - Fusion Telecommunications International, Inc. ("Fusion") (OTCQB: FSNN) announced today that it has signed an Asset Purchase and Sale Agreement under which a wholly-owned subsidiary of Fusion has agreed to acquire the customer base and other specified assets used in the operation and delivery of the cloud-based voice, unified communications and managed network services business of Broadvox, LLC ("Broadvox"), for a purchase price of $32.1 million, subject to adjustment. Following completion of the acquisition Fusion intends to integrate the network infrastructure, operating platforms and personnel employed in the current delivery of Broadvox's business cloud communications services (the "Acquired Business") into the company's NBS Business Services division.
Matthew Rosen, Fusion's Chief Executive Officer, said, "This Agreement is an important step forward in Fusion's growth strategy and complements our own organic growth with the addition of 5,800 small, medium and large cloud communications business customers. The Acquired Business generated unaudited annual revenue of approximately $30.9 million in 2012, over 90% of which is monthly recurring revenue, and we expect that this acquisition will be accretive to Fusion's earnings from day one. The acquisition is expected to significantly add to Fusion's loyal customer base and bring a significant number of new partners to Fusion's existing distribution network, creating significant upsell opportunities. The acquisition is also expected to allow Fusion to tap an experienced team of professionals who share our own commitment to service excellence. With a robust national network connecting every major market and best of breed infrastructure, completion of this acquisition would expand our network reach and improve our ability to rapidly scale as we emerge as a leading provider in the cloud services marketplace."
"We are very excited about the benefits this Agreement will bring to our customers in terms of product innovation and customer experience," said Andre Temnorod, Broadvox Founder, President and CEO. "Fusion's professional management and customer-centric culture very much reflect our core values and we fully expect that this transition will be beneficial to our customers over the short and long term."
The acquisition is scheduled to close during the fourth quarter 2013, subject to the satisfaction of certain conditions, including Fusion's receipt of sufficient financing to fund payment of the $32.1 million purchase price (plus an agreed-upon amount of post-acquisition working capital), receipt of necessary regulatory approvals and certain third-party consents, audit of the financial statements of the Acquired Business and other specified conditions of closing. In addition, closing of the transaction is subject to demonstration that the Acquired Business achieved annualized earnings before interest, taxes, depreciation and amortization ("EBITDA") of not less than $5.0 million for the three months preceding the closing (with a downward adjustment of the purchase price to the extent that such annualized EBITDA is less than $6.0 million but more than $5 million). The Company further expects to realize considerable synergies after the transaction is consummated.
About Fusion
Fusion is a global provider of Unified Communications and cloud solutions to businesses and carriers worldwide. Fusion's advanced, high availability service platform enables the integration of leading edge products and services in the cloud, including voice, data, managed network services, cloud computing, storage, information technology, data center services and security. Our solutions are customized to serve the unique needs of specialized vertical markets, with a strong focus on HIPAA-compliant solutions for the healthcare industry. Fusion's innovative yet proven cloud-based solutions lower our customers' cost of ownership, and deliver new levels of security, flexibility, scalability and speed of deployment. For more information, please visit www.fusiontel.com.
About Broadvox
Broadvox is a leader in providing customized, integrated cloud-based voice and unified communications solutions to support SMB, Enterprise and Carrier customers. It has deployed one of the largest, full-featured global IP-based networks and is trusted by over 300 telecommunications carriers, ASPs, ISPs and more than 10,000 businesses and 4,000 partners nationwide. Broadvox delivers Cloud-based Communications, SIP Trunking, SIP origination and termination services and broadband. Broadvox is headquartered in Dallas, Texas. For more information, visit www.broadvox.com
Forward Looking Statements:
Statements in this press release that are not purely historical facts, including statements regarding Fusion's beliefs, expectations, intentions or strategies for the future, may be "forward-looking statements" under the Private Securities Litigation Reform Act of 1996. Such statements consist of any statement other than a recitation of historical fact and can be identified by the use of forward-looking terminology such as "may", "expect", "anticipate", "intend", "estimate" or "continue" or the negative thereof or other variations thereof or comparable terminology. The reader is cautioned that all forward-looking statements are speculative, and there are certain risks and uncertainties that could cause actual events or results to differ from those referred to in such forward-looking statements. This disclosure highlights some of the important risks regarding the Company's business. The primary risk of the Company is its ability to raise new and continued capital to execute its comprehensive business strategy. There may be additional risks associated with the integration of businesses following an acquisition, concentration of revenue from one source, competitors with broader product lines and greater resources, emergence into new markets, the termination of any of the Company's significant contracts or partnerships, the Company's ability to comply with its senior debt agreements, the Company's inability to maintain working capital requirements to fund future operations, the Company's ability to attract and retain highly qualified management, technical and sales personnel and the other factors identified by us from time to time in the Company's filings with the Securities and Exchange Commission, which are available through http://www.sec.gov. Statements in this press release related to the projected EBITDA, cost-synergy savings and other forecasted benefits of our acquisition of the Acquired Business are "forward-looking" statements and are based upon certain assumptions that may or may not prove to be accurate; and if inaccurate could cause our actual results to differ materially from our projections. However, the risks included should not be assumed to be the only things that could affect future performance. We may, among other things, also be subject to service disruptions, delays in collections or facilities closures caused by potential or actual acts of terrorism, natural disasters or government security concerns.
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