The Swedish firm is targeting small and medium-sized businesses through the acquisition

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Sinch to acquire MessageMedia in $1.3bn deal. (Credit: Tumisu from Pixabay)

Sinch, a Swedish cloud communications services provider, has agreed to acquire MessageMedia, an Australia-based mobile messaging solutions company, for $1.3bn in a cash-cum-stock deal.

The consideration is made up of $1.1bn and 1,128,487 new shares in Sinch.

MessageMedia caters to small and medium-sized businesses in Australia, New Zealand, the US, and Europe.

The company’s web-based software-as-a-service (SaaS) suite enables businesses to utilise a two-way messaging without any coding requirement or knowledge of APIs.

MessageMedia, which is complemented by its sub-brands SimpleTexting and ClickSend, is claimed to serve more than 60,000 customers and handles over five billion mobile messages annually.

MessageMedia CEO Paul Perrett said: “Mobile messaging delivers tremendous ROI but smaller businesses often lack tools that cater to their specific needs.

“Serving these customers presents a tremendous opportunity, and with Sinch we can build a global leader in our field.”

The Australian company’s platform is said to enable multiple brands to make use of the same underlying technology. The platform’s multi-brand capabilities also allow mobile operators to deploy the offering on a white label basis.

MessageMedia also offers pre-configured integrations to cloud platforms such as Shopify, HubSpot, and NetSuite.

For the 12 months ending 30 June 2021, the company is anticipated to register $151m in revenues and a gross profit of $94m.

Sinch CEO Oscar Werner said: “Addressing small and medium-sized businesses opens up a new avenue to growth and dramatically expands our addressable market. With MessageMedia as a part of Sinch, we will have the best team in the industry to capitalise on that opportunity.”

On the other hand, Sinch provides software to mobile operators. The Swedish company’s platform is said to drive business-critical communications for several major companies in the world.

After the closing of the deal, MessageMedia is expected to be helped from cost synergies by making use of Sinch’s global network for messaging with direct connections to over 450 mobile operators. Besides, it will benefit from the latter’s investments in WhatsApp, Viber, Instagram, RCS, and other conversational messaging channels.

The deal, which is subject to regulatory approvals in Australia and the US, and other customary closing conditions, is expected to close in the latter half of this year.

In February 2021, Sinch signed an all-cash deal worth $1.14bn to acquire Inteliquent, a US-based voice communications provider. This deal is also expected to close in the second half of 2021.