Convergys Wins Fire Sale Bid
Unstrung believes ADC Telecommunications Inc. (Nasdaq: ADCT) had been at the front of the pack but was pipped at the post.
The acquisition, no doubt for a knockdown price -- "We are very pleased with the deal," says a Convergys spokeswoman -- gives the Cincinnati-based billing company a neat new list of mobile operators that it can now call its customers. These include parts of the Vodafone Group PLC (NYSE: VOD) empire (albeit some of the smaller European businesses), Hong Kong's SmarTone Mobile Communications Ltd. (Hong Kong: 0315), and Finland's Radiolinja Oy.
Whatever the price, cash, rather than stock, was used. Stock was the currency when Convergys bought Geneva Technology in March 2001. That acquisition was worth just over US$690 million at the time, based on a share price of $39.35. The current Convergys share price is around $18.
So what does the future hold for the new customers and for TelesensKSCL's mainstay billing product, Jupiter? Will it survive?
Stephen Newton, president of Convergys EMEA, tells Unstrung: "As far as the TelesensKSCL customer base is concerned, we will be talking to each client individually about the optimal way forward, about support of their Jupiter installation, and the solutions they need in the future. We will continue to sell and support Jupiter." But, it seems, not develop it any further, as "we will not be integrating Jupiter into our next-generation framework [NGF]," a Convergys spokesperson adds.
Whether they like it or not, the migration path for Jupiter customers is the NGF, which, says Newton, "offers a flexible migration path to TelesensKSCL customers who until now have been living with considerable uncertainty about the future of their billing systems."
We are sure they feel much better about things now.
— Ray Le Maistre, European Editor, Unstrung