Sonus has put the final touches on its merger with Genband, renaming the combined company under the new Ribbon Communications brand.
The company will continue to trade on the Nasdaq Global Select Market under the ticker SONS until its new corporate name (Ribbon Communications Inc.) and its new ticker symbol (RBBN) become effective, which the company said should happen by the end of 2017.
As a merger of equals, the former Sonus and Genband shareholders each own approximately 50% of the parent company, which had approximately 102 million shares outstanding post close.
Genband's former equity holders also received a $22.5 million unsecured note as part of the transaction consideration. The company said they expect the to be “substantially accretive to the combined company’s earnings per share in 2018.”
The combined company is expected to realize annual cost synergies of $40 million to $50 million in 2018 and to drive solid cash flow from operations in the first year after closing.
Ray Dolan, present CEO of Sonus, will lead Ribbon Communications.
“Our new name offers a fresh start and embodies our ambition to build one of the largest, most innovative, dedicated and secure global real-time communications organizations on the market,” Dolan said in a release. “In today’s complexly woven world, we deliver the secure, immersive, contextual experiences that enhance our lives.”
Sonus has never been shy about acquiring other vendors to bolster its portfolio. In 2016, the company acquired Taqua in a deal that immediately enhanced its wireline and wireless plans with a set of complementary Class 5 switching and mobile core network capabilities.
The company recently reported $74.6 million in third-quarter revenues.
As of the end of the third-quarter, Sonus had two customers that contributed 10% or more of total revenue in the third quarter of 2017: Verizon, which contributed approximately 16% of revenue, and AT&T, which contributed approximately 11% of revenue.
Genband’s revenue for the third quarter of 2017 was in line with the preliminary results reported on Oct. 13, 2017.