MTS - Mer Telemanagement Solutions Ltd. an Israel based company with offerings for carriers and enterprises announced on December 23, 2008 that it had signed an agreement to acquire AnchorPoint Inc. a Telecom Expense Management (TEM) provider. MTS brings some interesting wireless management capabilities while AnchorPoint is likely to gain more traction with its Map-to-WinSM approach to client engagements. This development will serve to continue the consolidation of suppliers in the TEM market.
On December 23, 2008 MTS - Mer Telemanagement Solutions Ltd. an Israel based global provider of Business Support Systems, customized solutions for Telecommunications Management, and Customer Care and Billing announced that it had signed an agreement to acquire AnchorPoint Inc. a Telecom Expense Management (TEM) provider. The transaction was completed on December 30, 2008. It was based on a shares transaction and some other factors that were not not disclosed. The aggregate consideration will be 25% of MTS's outstanding shares on a post-transaction basis.
The consolidation plans call for the existing product lines to remain intact, and MTS will integrate its telecommunication management and billing solutions with AnchorPoint in the future. The AnchorPoint brand will be retained and it will continue operations as a division of MTS. MTS North America will maintain headquarters in Fairlawn, NJ and AnchorPoint locations in Framingham, MA and Powder Springs, GA.
This acquisition continues the trend of market consolidation for the fragmented TEM market. There have been many mergers that preceded the MTS acquisition of AnchorPoint. Avotus came from the merger of Switchview with MDR and later acquisitions of Applied Research Technologies (ART) and Formity Systems. Broad:margin merged with Teldata Control to form Control Point Solutions, which was acquired by HCL. ProfitLine acquired FedCell. The consolidation of Stonehouse Technologies, Telco Research, and Teletron's assets established Symphony SMS. Telwares came from the roll-up of TSL, MSS Group, Digital Reliance, Telwares, and QuantumShift. In the past two years, Invoice Insight acquired Oreon, MDSL acquired Union Square Consulting; Rivermine acquired BBR Wireless Expense Management; and Tangoe has grown through the acquisitions of TRAQ Wireless, Parse Logic, and ISG.
In some cases, these mergers were a natural development that arose from business alliances where TEM suppliers utilized the strengths of a partner to meet the needs of customers. many suppliers now believe the best way to become profitable is to grow through acquisitions. Today, TEM suppliers must invest to meet customer challenges for wireless mobility management international TEM, and inventory management. They seek seek to amortize the costs of developing more sophisticated TEM solutions over a larger base of customers
There are no guarantees that the acquisition of AnchorPoint by MTS will succeed, but a number of factors should help make this combination work for enterprise customers. AnchorPoint and MTS share a common heritage with their call accounting business, which is sold direct and through channel partners. This common heritage and sales approach should eliminate some of the distractions that other suppliers would face. There are no expected changes that will be made to customer facing support and account teams based on both organizations maintaining their existing staff. In fact, one of the stated goals for this merger is to keep the existing staff in order to facilitate future growth and expansion. Both firms have dispersed sales, operations, and software development so their management teams are used to coordinating activities in different regional offices.
The combination of MTS and AnchorPoint should allow the firms to provide additional resources for support, development and project management. MTS has a more diversified product offering that targets telecom service providers as well as enterprises. The combined firm will need to balance this diversified product portfolio with a need to stay focused on delivering results to clients. The new firm has some work to establish a stronger position. It will need to retain existing personnel, clients, and work through its integration plans. It still needs to grow, but this merger holds promise. It may serve as a catalyst for organic growth, to be acquired as part of the continuing market consolidation or the merger may position the firm to acquire another supplier.
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