Digi Purchases Ventus Holdings
Tuesday, November 02, 2021 | Comments

Digi International, a provider of internet of Things (IoT) connectivity products and services, purchasesd Connecticut-based Ventus Holdings, a provider of managed network-as-a-service (MNaaS) solutions that simplify the complexity of enterprise wide area network (WAN) connectivity.

The acquisition will enable the company to provide software and subscription service plans along with hardware, thereby strengthening its position as a supplier of complete, high-value networking solutions.

In its 20 years of operations, Ventus provides innovative, secure, market-driven enterprise-class networks. Ventus’s portfolio includes cellular wireless and fixed line WAN solutions for an array of connectivity applications in banking, healthcare, retail, gaming, hospitality and other sectors.

Digi acquired Ventus for $347.4 million in cash, which is just over eight times annualized recurring revenues. To finance the purchase, Digi secured a $350 million debt facility through existing lender BMO Harris Bank N.A. and its affiliates. Stephens served as financial advisor to Digi on the acquisition and provided a fairness opinion.

“Our primary goal is to simplify the deployment and management of sophisticated and distributed enterprise networks,” said Digi President and CEO Ron Konezny. “Our acquisition of Ventus leverages our unique understanding of the evolving connectivity needs and challenges enterprises face today from wide geographic footprints to large numbers of dynamic and intelligent endpoints. We’re proud to renew our commitment to reducing the complexities of network and endpoint connectivity, as well as simplifying the building, hosting deploying, monitoring, and maintenance of secure, disruption-free WAN networks.”

Digi expects the acquisition to be immediately accretive to its non-generally accepted accounting principles (GAAP) measurements of adjusted earnings before interest, debt and amortization (EBITDA) and adjusted earnings per share (EPS). Because of interest expense on the credit facility on a GAAP basis the acquisition is expected to be mildly non-accretive on net income and earnings per share (EPS) in fiscal year 2023. Digi expects to report Ventus’ performance as part of its IoT Solutions segment.

“Joining a trusted industry leader like Digi presents tremendous opportunities for our combined teams to collaborate on more innovative networking solutions,” said Steve Glaser, who will advance from chief operating officer (COO) of Ventus to the general manager of Ventus under Digi’s ownership. “Collectively, our world-class hardware and software solutions, network expertise, engineering talent, and exceptional client support will create significant value and innovation for enterprises around the world.”

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