Billing and customer relations management company Amdocs Ltd. (Nasdaq: DOX) is in talks to buy Ra'anana-based company Pontis Ltd. Talks have been underway for a year, and are yet to be finalized, probably due to disagreements over the price to be paid by Amdocs, which is estimated to be in the region of $80-90 million. Amdocs, managed by CEO Eli Gelman, declined to comment on reports on this matter.
Pontis develops products that enable companies to provide customers with real-time recommendations in their fields of interest, that is, while they surf the web using a desktop computer or a mobile device. The company says that over 600 million surfers worldwide have been exposed to offers via its system. Pontis clients include large communications companies such as Vodafone and Telefonica.
Pontis, which employs 200 workers, has received investments from Amdocs in the past, as well as from venture capital funds such as Sequoia Capital, NVP, Accel Partners and Evergreen Venture Partners. Overall, investments in the company since it was founded in 2003 by CTO Michael Kerbis total $70 million. The company's CEO is Udi Ziv.
Amdocs Ltd. (NYSE: DOX) provides billing and IT solutions, mainly to communications and media companies. Pontis' products could be used by Amdocs as a complementary product to some of its solutions. In the third quarter of 2016, Pontis had revenue of $930 million, a 2.4% rise from the corresponding quarter.
Amdocs' guidance for the current quarter (the fourth quarter for the company) predict $920-960 million revenue, which ranges from a 1% decline to a 3% rise compared with the third quarter, while analysts' estimates predict $950 million revenue. In the first three quarters, Amdocs' revenue totaled $2.8 billion.
In the third quarter, Amdocs' GAAP-based profit declined 2.5% compared with the corresponding quarter, to $106 million, and dropped 11.7% compared with the corresponding three quarters, to $314 million. On the other hand, its non-GAAP net profit rose 3.3% to $136 million in the third quarter and 2.1% to $408 million in the first three quarters.
In the third quarter, Amdocs had $117 million free cash flow, and bought back its own shares to the tune of $123 million.
Published by Globes [online], Israel business news - www.globes-online.com - on August 30, 2016
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