Sinch, a Swedish cloud communications provider for mobile customer engagement, has acquired SAP Digital Interconnect, a unit of SAP SE, for EUR 225 million on a cash- and debt-free basis. The transaction values the unit at an EBITDA multiple of 14.6x, or 8.5x including estimated synergies at full run-rate. Sinch has financed the acquisition through its own cash and credit facilities.
The acquisition is part of Sinch's strategy to grow both organically and via M&A, with a long-term focus on profitability and cash flow. The transaction is subject to regulatory approval from competition authorities in multiple jurisdictions and it is expected to be finalised in H2 of this year.SAP Digital Interconnect (SDI) offers cloud-based communications products and serves more than 1,500 enterprise customers worldwide. Its customers include technology companies, banks, payment gateways, retail brands, and mobile operators.
SDI has three segments, namely programmable communications, carrier messaging and enterprise solutions. It recorded revenues of EUR 340 million, gross profit of EUR 94 million, and adjusted EBITDA of EUR 15.4 million for the twelve months ended 31 March. It employs around 330 people in 20 countries and is headquartered in San Ramon, California.
