Convergys Buys WhisperWire, Encore

Convergys eats sales effectiveness software vendor WhisperWire and accounts receivable manager Encore Receivable Management

May 4, 2004

5 Min Read

CINCINNATI and AUSTIN, Texas -- Convergys Corporation (NYSE: CVG), the global leader in integrated billing, employee care, and customer care services, announced today the acquisition of Austin-based WhisperWire, Inc, a provider of industry-specific sales effectiveness software. The transaction closed Monday, May 3, 2004.

The acquisition will be neutral to Convergys' 2004 earnings per share.

WhisperWire's PowerSeller software closely complements Convergys' Infinys [r] business support system (BSS) for ordering, billing, and customer care for converged voice, data, and video services. The acquisition enables Convergys to offer communications providers a complete solution to drive their sales process more effectively from the original lead to cash generation. It combines WhisperWire’s success in increasing close rates during the lead-to-sale process with Convergys’ success in expediting the sale-to-cash process.

With this acquisition, Convergys adds additional capabilities to offer clients:

  • Increased revenue growth and cost savings

  • Reduced order and provisioning errors (adjustments/credits)

  • Reduced cycle-time from ordering through billing and provisioning

  • Increased customer satisfaction

  • Decreased customer churn and margin erosion

“In the competitive communications market, providers are searching for ways to help salespeople be more productive while continuing to control costs. By combining WhisperWire’s sales effectiveness software with the Convergys Infinys business support system, providers now have a single solution that gets proposals to the client faster, speeds the order process, and ensures order accuracy,” said Sheryl Kingstone, CRM Program Manager for the Yankee Group. “In addition, clients benefit from greater satisfaction in both the buying process and order management phases, leading to reduced customer churn.”

“In the lead-to-sale process, WhisperWire clients have significantly increased the number and value of closed deals, while also reducing sales costs. This dramatic effect on revenue, combined with the operational efficiencies and client satisfaction of our Infinys business support system will significantly impact our client's revenue," said Dave Dougherty, Executive Vice President, Convergys Global Information Management. "Our wireline, cable, and wireless clients need a solution to drive revenue with increased sales effectiveness in their businesses. The combination of the Powerseller software package with our Infinys solution is ideal. Collectively, we expect our combined solution to serve as a key differentiator and generate greater value for these clients.”

"We are excited to be joining Convergys," said Michael Heflin, CEO of WhisperWire. "Leveraging the strengths of both companies, we are uniquely positioned to seamlessly tie the entire sales and business support processes together; allowing communication providers to dramatically change their competitive landscape.”

In a separate release:

CINCINNATI and KANSAS CITY -- Convergys Corporation (NYSE: CVG), the global leader in integrated billing, employee care, and customer care services, announced today it is entering the accounts receivable management market and expanding its business process outsourcing capabilities with the acquisition of Encore Receivable Management, Inc. of Olathe, Kansas.

Convergys and Encore have signed a purchase agreement under which Convergys will acquire 100 percent of the outstanding shares of Encore. Closing is expected as soon as practicable following regulatory approval.

The acquisition will be neutral to Convergys’ 2004 earnings per share. Convergys will pay up to $68 million contingent upon possible earn-out payments based on future performance. This figure represents about one times Encore's anticipated 2004 revenue.

Encore is a well respected, nationally licensed, privately held company with about 1,100 employees. It is a full service firm supporting both the pre- and post-chargeoff markets and specializing in the collection of past due or delinquent accounts mainly for large clients in the bank card, telecommunications, retail, and automotive industries. Encore's clients include 9 of the top 10 bankcard issuers in the United States.

Encore has two facilities in Kansas City and one in Las Vegas. Encore Receivable Management will be operated as a wholly owned subsidiary of Convergys Corporation.

With the closing of this strategic acquisition, Convergys will

  • Enter the accounts receivable management business which is a $9 billion addressable market growing at a double digit rate (Source: Kaulkin Ginsburg)

  • Expand Convergys' service offerings into a complementary market leveraging new and existing client relationships

  • Build on Encore's strong and stable culture, performance-driven environment, and integrated processes and systems

“This acquisition is a natural extension of the core Convergys business model in terms of leveraging its infrastructure, capabilities, and established presence in customer contact businesses," said John Grund, Partner, First Annapolis Consulting. "The potential to extend and deepen existing client relationships is a particularly attractive aspect of this transaction.”

"Accounts receivable management is a significant, growing market and a logical extension of Convergys' service offerings because Convergys already shares many synergies in contact center expertise and experience, advanced technologies, global reach, and strong client relationships," said Jack Freker, President of Convergys’ Customer Management Group. "The acquisition of Encore provides immediate accounts receivable management expertise and also better positions Convergys by expanding our customer care footprint to a whole new vertical market and supporting our strategy to accelerate revenue growth in our Customer Management business."

Among Encore's key attributes are leading edge technology throughout the company, more than 185 years of cumulative industry experience from the leadership team, and a quality assurance process that covers all aspects of operations from new client setup to staff performance. Encore also provides client-specific training programs that enhance productivity, agent effectiveness, and customer communications.

Convergys Corp.

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