Redknee share sale could set stage for M&A

Redknee is offering 13 million common shares to raise nearly $17.83 million, which could be used for potential acquisitions in the billing and customer care arena.

The Toronto-based company signed up a syndicate of underwriters led by GMP Securities and including Canaccord Genuity and TD Securities for the sale, which is priced at C$1.35 per common share to aggregate gross proceeds to Redknee of slightly less than $17.83 million.

In announcing the sale, Redknee said the net proceeds would be used for "working capital and general corporate purposes and potential acquisitions." LightReading suggested the company might be interested in acquiring at least some of the business support systems (BSS) business that Nokia Siemens Networks wants to sell off. In early September, NSN CEO Rajeev Suri confirmed that vendor is in talks with various companies to sell its (BSS) unit as part of its restructuring.

Redknee's share offering is expected to close on or about Oct. 23, 2012.

Redknee also disclosed a multimillion-dollar, multiyear deal under which it will provide cloud-based converged billing and customer care as a fully managed, software-as-a-service offering to Step Up Mobile, a U.S.-based mobile virtual network operator (MVNO) launching on the Sprint 3G and LTE networks.

Redknee's pre-integrated billing and customer care platform is built on the Microsoft platform, which includes Microsoft Dynamics CRM, SQL Server and Windows Server.

The OSS/BSS sector is seeing an uptick in M&A activity. Last week Ericsson (Nasdaq: ERIC) added to its portfolio by reaching an agreement to purchase Toronto-based ConceptWave for an undisclosed amount.

For more:
- see this LightReading article
- see this Redknee release

Related articles:
UPDATED: Ericsson adds to OSS/BSS portfolio with ConceptWave acquisition
Nokia Siemens CEO Suri confirms desire to sell BSS unit
Rumor Mill: NSN selling Business Support Services unit