Nuance Communications has announced a definitive agreement to acquire privately-held SNAPin, a provider of mobile device and server self-service technology. With the resources of Nuance and SNAPin, the combined organization says it aims to provide mobile customer care solutions that 'transform the way mobile operators and enterprises interact with consumers in real-time on mobile devices'.
"The integration of Nuance's mobile solutions and enterprise speech solutions allows Nuance to sharply reduce the costs of customer care and improve the quality of customer experience for mobile operators and large enterprises," said Steve Chambers, president of the Mobile and Consumer Services Division at Nuance. "Leveraging the proliferation of mobile devices worldwide, Nuance's solutions, combined with powerful technology from SNAPin, enable Nuance to deliver the economies of Web-based self-service to the growing expanse of mobile consumers."
According to Nuance, by combining SNAPin's key intellectual property, mobile expertise and established device and operator relationships with Nuance's robust capabilities in customer care and handset solutions and longstanding mobile and enterprise relationships, the company is positioned to deliver 'superior' mobile care solutions and fulfill a significant global opportunity that has captured the interest of the world's largest mobile operators.
As an example, says Nuance, Vodafone is using SNAPin's software to provide its customers with the ability to automatically resolve common requests - diagnose and repair configuration problems, make account inquiries and solve problems - directly on their mobile phone. "Delivering a superior customer experience at all touch points for our subscriber is key to how we acquire and retain loyal customers," said Adam Spence, group self service development manager for Vodafone Group. "We are excited by the joining of Nuance and SNAPin as it reinforces our strategy to offer our customers the most innovative and powerful mobile self-service experience across all of our established and emerging markets."
Nuance expects the acquisition in fiscal 2009 to add between $29 million and $32 million in non-GAAP revenue; $19 million and $22 million in GAAP revenue after adjusting revenue lost to purchase accounting; non-GAAP earnings between $0.01 and $0.02; and a GAAP loss between $(0.05) and $(0.06) including amortization and stock-based compensation. SNAPin solutions are delivered through the handset in a revenue model based on the value of transactions or calls served on the handset. Nuance has experienced rapid growth in its mobile business for the last several years and now anticipates combined mobile revenues in Fiscal Year 2009 between $260 and $275 million.
Under the terms of the agreement, consideration for the transaction is approximately $180 million in Nuance common stock. SNAPin's shareholders will be eligible for additional earn-out consideration based upon the achievement of certain financial and operational milestones. The transaction is expected to close in October 2008, subject to customary closing conditions and approvals, and is expected to be accretive in fiscal 2009.