San Francisco-based Genesys announced that it has entered into a definite agreement to acquire Interactive Intelligence Group, an Indianapolis-based provider of cloud-based software and services for the contact center in a cash-and-stock deal valued at $1.4 billion.
The goal is to create an omnichannel entity with global scale and multinational-quality reliability. "Our combined product portfolio will provide the broadest set of transformative customer experience solutions optimized for customers of all sizes and sophistication levels, available both in the cloud and on-premises," Genesys CEO Paul Segre said.
Genesys Will Continue to Nurture Its Onetime Rival's Portfolio
Indeed, this is no acqui-hire, or at least Genesys is not just interested its former competitor for its talent. The company fully intends to nurture Interactive Intelligence’s product portfolio.
"We will significantly invest across the entire Interactive Intelligence product portfolio to support the continued momentum of PureCloud, Cloud Communications-as-a-Service and Customer Interaction Center," Segre said.
The transaction is expected to close by the end of the year, subject to customary closing conditions, including regulatory approval and approval by Interactive Intelligence shareholders. Interactive Intelligence's Board of Directors and Genesys' Operating Committee has already approved the deal and Interactive CEO Don Brown, who owns approximately 17 percent of the company’s shares, has agreed to vote in favor of the transaction.
Genesys is among the group of old-school contact center players seeking to reorient themselves as unified communications providers. Some companies, such as Avaya, are burdened by decades of legacy infrastructure and investment.
Genesys could arguably have been included in that same category, but it has been pushing hard to add new capabilities in the last three years, usually through acquisition.
Eight months ago, to name one example, it acquired a Northern Ireland based company called SpeechStorm. The company, a provider of self-service applications for mobile, web and interactive voice recognition channels, had been a Genesys partner since 2010.
These moves have not gone unnoticed by investors. Private equity firm Hellman & Friedman purchased a minority interest in the company in July with a $900 million investment, raising Genesys to an approximate valuation of $3.8 billion.
A Bigger Genesys
The Interactive Intelligence deal, of course, is much bigger and far more strategic than the SpeechStorm buy. As a larger entity, Genesys will have more than $1.3 billion in revenue and annual R&D spend approaching $200 million.
So far the company execs have spent most of their time briefing their employees and customers on their path forward. But for a watching industry, the scale of the deal can hardly be missed — or underestimated. As Interactive Intelligence’s Brown said: The combination of Genesys and Interactive Intelligence provides a complete portfolio to address all market segments.