SUNNYVALE, Calif. – Dec. 21, 2015 – ShoreTel® (NASDAQ: SHOR), the leading provider of brilliantly simple hosted phone systems and unified communications (UC) solutions, today announced it is acquiring Corvisa LLC, a provider of cloud-based communications solutions, from Novation Companies, Inc. (OTCQB: NOVC). This acquisition is expected to accelerate ShoreTel’s fiscal 2017 hosted revenue growth to at or around 30 percent by enhancing ShoreTel’s solutions and architecture in four key areas:
- Corvisa’s open, standards-based application programming interfaces (APIs) and software development kits (SDKs) will accelerate third party application integration within the ShoreTel ecosystem.
- The addition of Corvisa’s SIP trunking to the ShoreTel solution portfolio will position ShoreTel as a SIP trunking provider, unlocking new revenue streams for ShoreTel and its channel partners while delivering simpler transactions for customers.
- Corvisa’s standalone cloud contact center expands ShoreTel’s presence in the rapidly growing contact center market, allowing for integration with non-ShoreTel communication solutions.
- The acquisition will bring approximately 95 employees, most of whom are in technical and customer-facing roles. These highly desired technical engineers will be instrumental in the acceleration of ShoreTel’s innovative architecture and product roadmap.
In addition, ShoreTel continues to expand its cloud services in Europe as a result of acquiring Corvisa’s Amsterdam and UK data centers.
“The acquisition of Corvisa aligns tightly with our strategic plan and acquisition priorities. We are in our acceleration phase of our strategic plan, focused on accelerating technology time to market, growing hosted revenue, and expanding our cloud offering globally,” said Don Joos, president and CEO of ShoreTel. “Corvisa’s technology and engineering resources are very complementary to ShoreTel. I’m excited about the robust API’s to accelerate application integration and the additional growth that an expanded cloud contact center will bring.”
“We are delighted to be joining ShoreTel,” said Matt Lautz, CEO of Corvisa. “ShoreTel has global reach, is able to scale for all business communication needs and has shown a strong track record of growth. We believe Corvisa’s cloud contact center coupled with ShoreTel’s go-to-market expertise in this area creates a compelling combination.”
ShoreTel will pay $8.5 million in cash to acquire Corvisa, which represents a portion of the parent company’s revenue, expenses and employee base. The transaction is expected to close during the March 2016 quarter, subject to customary closing conditions. ShoreTel expects the ongoing impact of the acquired Corvisa business in the first 90 days of operations to reduce its non-GAAP operating profit by approximately $3.5 million. The GAAP operating results will also be impacted by an additional $1 million related to one-time deal expenses in the March 2016 quarter. Based on its current expectations and factoring in the impact of the Corvisa acquisition, ShoreTel expects to return to non-GAAP operating profit in the quarter ending June 2016. ShoreTel will provide further financial guidance reflecting both the M5 Australia acquisition, announced on November 4th, and the Corvisa acquisition during its Q2 FY16 earnings announcement.
About ShoreTel, Inc.
ShoreTel, Inc. (NASDAQ: SHOR) is a leading provider of brilliantly simple IP phone systems and unified communications solutions powering today’s always-on workforce. Its flexible communications solutions for on-premises, cloud and hybrid environments eliminate complexity, reduce costs and improve productivity. Recognized for its industry-leading customer experience and support, ShoreTel’s innovative business phones, application integration, collaboration tools, mobility, and contact center applications enable users to communicate and collaborate no matter the time, place or device, with minimal demand on IT resources. ShoreTel is headquartered in Sunnyvale, Calif., and has regional offices and partners worldwide. For more information, visit www.shoretel.com.
Legal Notice Regarding Forward-Looking Statements
ShoreTel assumes no obligation to update the forward-looking statements included in this release. This release contains forward-looking statements within the meaning of the “safe harbor” provisions of the federal securities laws, including, without limitation, statements regarding the expected benefits of the proposed acquisition. The forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. The risks and uncertainties include our ability to integrate Corvisa, our ability to retain Corvisa’s customer base, potential unknown liabilities, security breaches or outages which may negatively affect our reputation, managing geographically-dispersed operations, uncertainty as to ShoreTel’s ability to retain and motivate key personnel from the acquired company, the potential for litigation in our industry, and other risk factors set forth in ShoreTel’s Form 10-K for the year ended June 30, 2015, and in its Form 10-Q for the quarter ended September 30, 2015.
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