One of Tampa Bay’s largest private companies is returning to the public market in a merger that values the combined firm at more than $2.8 billion.
Syniverse, a telecommunications company that specializes in mobile and cloud connectivity, will merge with publicly traded New York acquisition company M3-Brigade Acquisition II Corp. that will infuse the firm with up to $1.2 billion in cash, according to a press release.
Upon completion of the deal, the Tampa company will return to the New York Stock Exchange under the name Syniverse Technologies Corporation and ticker symbol SYNV. It’s familiar territory for Syniverse, which was once one of Tampa Bay’s largest public companies until it was sold to private equity firm the Carlyle Group in 2011 for $2.6 billion in cash.
Syniverse CEO Andrew Davies said the infusion of capital will allow the company grow and expand to capitalize on the potential of the world’s growing 5G wireless network. The company handles nearly 3.5 exabytes of data annually, he said, which is equal to 3.5 billion gigabytes, or 10,000 times the amount of data stored in the Library of Congress.
“Syniverse may be the most important company you’ve never heard of,” Davies said on a conference call Tuesday. “If you’ve ever sent a message to someone with another carrier, that’s Syniverse. If you’ve traveled overseas and made a phone call there, That’s also Syniverse. And if you’ve receeved a text message with any two-factor authentication code, an airport gate change notification, or a delivery reschedule, that’s Syniverse, too.”
The deal includes an investment from cloud communications firm Twilio, which announced in March it was investing between $500 million and $750 million into Syniverse. As a result, Twilio will own a minority stake in the company.
The Carlyle Group will also stay on as a minority owner. Two other firms, Oak Hill Advisors and Brigade Capital Management, will invest $265 million through the purchase of stock at below market value.
Calling Syniverse “integral in the mobile-centric 5G world,” Mohsin Meghji, CEO and chairperson of M3-Brigade Acquisition II Corp., said the Twilio partnership and capital would give the company plenty of flexibility to grow, with lots of potential for international growth.
Syniverse reported revenues of $646 million in 2020, according to a merger prospectus filed with the U.S. Securities and Stock Exchange, and is forecasting $678 million this year. It projects annual revenues could grow to more than $1.2 billion by 2025, per the prospectus.
Syniverse started as an arm of GTE, then spun off in 2001 when that corporation merged with Bell Atlantic to create Verizon. When Syniverse went public in 2005, the $282 million raised in its initial public offering was at the time the most ever by a Tampa Bay public company.
If the merger happens, it will be only the latest multi-billion-dollar transaction involving a Tampa Bay company this year.
After announcing plans to sell to a competitor in April, New Port Richey restaurant kitchen equipment supplier Welbilt changed course and has reached a deal to sell to an Italian company for $3.5 billion. Largo’s Tech Data is expected to merge this year with a California company in a deal worth $8 billion that will return the company to the public sphere. And in June, Tampa’s Sykes Enterprises announced plans to sell to a Miami company for $2.2 billion.