Altigen Announces the Closing of its Acquisition of ZAACT Consulting
Altigen Communications (OTCQB:ATGN) has successfully acquired the assets of ZAACT Consulting, a company specializing in Microsoft Teams solutions. The transaction, which closed on May 6, 2022, positions Altigen as a leading provider of cloud communications and collaboration services. ZAACT generated over $5.3M in revenue in fiscal 2021, with about $0.5M in net income. The purchase was funded primarily by cash and stock, totaling $4.5M. This acquisition is expected to enhance Altigen's capabilities and customer base in the Microsoft ecosystem.
- Acquisition enhances Altigen's capabilities in Microsoft Teams solutions.
- ZAACT's expertise brings additional enterprise customer base and growing revenues.
- Total purchase price of $4.5M indicates a strategic investment.
- Funding the acquisition with new shares may lead to shareholder dilution.
- Integration challenges and retention of ZAACT's employees and customers could pose risks.
Combination positions Altigen as a Leading Provider of Microsoft Teams Communications and Collaboration Solutions and Services
MILPITAS, CA / ACCESSWIRE / May 10, 2022 / Altigen Communications, Inc. (OTCQB:ATGN), a leading Silicon Valley-based provider of cloud-based Customer Experience (CXaaS) solutions built on Microsoft technologies, today announced that it closed on the transaction to acquire the assets of Intermountain Technology Group, doing business as ZAACT Consulting ("ZAACT"). The acquisition involved substantially all of the assets of ZAACT (excluding cash and accounts receivables) as of the closing date. The acquisition closed on May 6, 2022.
"The acquisition of ZAACT provides Altigen with valuable technical resources, an enterprise customer base and growing revenues," said Jerry Fleming, chairman and CEO of Altigen. "As we continue to introduce and enhance our innovative, natively integrated Microsoft Teams solutions, the complementary skill sets of ZAACT employees are precisely what Altigen needs to enhance our offerings for enterprise customers. Just as important, the vision and experience brought by the seasoned ZAACT executive team aligns very well with Altigen's executive team and our vision for the future."
Several members of ZAACT's leadership team will join Altigen as corporate officers. Ryan Day, ZAACT founder and chief executive officer, will become Altigen's chief strategy officer, reporting to Fleming. Trent Rowley, president and chief operating officer will become Altigen's chief operating officer, reporting to Fleming. Chris Weidemann, vice president of development will become Altigen's chief technology officer, and Darin Rohead, vice president of sales will join Altigen as vice president of sales service, both reporting to Rowley. Mark Allen, Altigen's current CTO, will assume the role of Chief Product and Innovation Officer, reporting to Fleming.
Day commented, "When I was first approached by Altigen, I was not looking to sell the company. However, I was intrigued by the possibilities as a result of an acquisition. During our many discussions and meetings with Altigen, the synergies between our companies became obvious. The combination of Altigen and ZAACT truly position the combined company as a leading provider of cloud software and services for Microsoft Teams, and I'm excited to move into my new role working with the combined leadership team to position Altigen as a leader in its space."
ZAACT Consulting, a Microsoft partner with 7 Gold competencies, provides technology assessment, custom development and cloud migration services focused on the Microsoft technology stack. The acquisition of ZAACT adds broad and deep expertise in Microsoft technologies and, more specifically, Microsoft Teams which are required to support Altigen's native Teams enterprise solutions.
For the fiscal year ended December 31, 2021, ZAACT generated over
Acquisition Terms
Altigen will fund the acquisition with cash on hand, and the issuance of new shares of common stock.
The transaction is effective as of May 6, 2022 | Annual | Total | |||||
Paid at Closing: | $ | 3.2 | |||||
Cash paid (from existing cash | $ | 2.9 | |||||
Stock (250,627 shares)* | $ | 0.3 | |||||
Anniversary Payments: | $ | 1.3 | |||||
Cash (3 years starting 5/6/23)*** | $ | 0.225 | $ | 0.7 | |||
Stock (2 years starting 5/6/23)** | $ | 0.3 | $ | 0.6 | |||
TOTAL PURCHASE PRICE | $ | 4.5 | |||||
Cash vs. Stock: | |||||||
Cash | 80 | % | $ | 3.6 | |||
Value of Stock | 20 | % | $ | 0.9 | |||
TOTAL PURCHASE PRICE | $ | 4.5 | |||||
*based on average closing price of prior 10 trading days to close | |||||||
** based on average closing price of prior 10 trading days to anniversary | |||||||
***Total may not add due to rounding | |||||||
About Altigen Communications
Altigen Communications Inc. (OTCQB:ATGN), based in Silicon Valley, is a leading Microsoft Cloud Solutions provider, delivering fully managed Cloud-based Unified Communications services based on the Microsoft platform. Our SIP trunk services, enterprise customer engagement and innovative cloud contact center solutions seamlessly integrate with Microsoft Teams to enhance and extend the business communications capabilities for our customers. Altigen's solutions are designed for high reliability, ease of use, seamless integration into Microsoft technologies, all delivered as fully managed cloud services. Our solutions are available through our global network of certified resellers. For more information, call 1-888-ALTIGEN or visit our website at www.altigen.com.
About ZAACT Consulting
ZAACT LLC has been a close integration partner with Microsoft for over ten years. The ZAACT focus has been helping companies implement deep dive Microsoft technologies such as Teams, Azure, SharePoint and Dynamics. Because of the unique focus on one platform for this services company, they have been able to drive an incredible amount of knowledge and experience into their company. Headquarters of ZAACT are in Sandy, UT and focus has been primarily on the Intermountain West and East coast. ZAACT is proud of the growth and success they have had with extremely satisfied clients and great employees. You can learn more about ZAACT by going to their website at www.zaact.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking information, including all statements that are not statements of historical fact regarding the intent, belief, assumptions or current and future expectations of Altigen, its directors or its officers with respect to the contents of this press release. Such statements are subject to a number of risks and uncertainties, including but not limited to, statements about the anticipated benefits of the acquisition of ZAACT, its executive management team and the expected future capabilities of the combined companies. Factors that could cause results to differ from our expectations include the following: potential difficulties with the integration of ZAACT and the retention of customers and employees of ZAACT. In addition, actual results are subject to other risks that relate to our ability to continue to introduce and enhance our offerings for enterprise customers and natively integrated Microsoft Teams solutions utilizing ZAACT's technical resources, our ability to grow revenue and to accelerate business opportunities, our ability to achieve increased market acceptance for our service offerings and penetrate new markets, as well as other risks set forth in the Company's most recent Annual Report filed through the OTC Disclosure and News Services on January 15, 2022. All information provided in this announcement is as of the date of this announcement, and the Company undertakes no duty to update such information except as required under applicable law.
Investor Relations Contact:
Brian Siegel, IRC, MBA
Senior Managing Director
Hayden IR
(346) 396-8696
brian@haydenir.om
SOURCE: Altigen Communications, Inc.
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