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OnMobile to sell VoxMobili for $23-26 million

(By Nikhil Pahwa & NT Balanarayan)
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OnMobile Global Ltd has informed BSE that it has signed a non-binding Memorandum of Understanding (MOU) to sell telecom solutions company VoxMobili for $23-26 million, without specifying who the buyer is. Note that Vox Mobili reported a turnover of EUR 12.70 million and profit of EUR 1.03 million in FY13. A price of between $24-26 million would essentially mean that the company is being sold for 1.32 to 1.49 times its FY13 turnover, and 16.24 to 18.36 times times profit.

VoxMobili is one of the two French companies acquired by Onmobile in France, the other being Telisma SA, which is now called Onmobile SA.

vox-mobili-financials

Onmobile had acquired the French company in 2007 for around $35.12 million, to expand its services to new markets, and the company served as its hub of European operations, but more importantly, for development of its data related products, as was indicated in its 2012 earnings conference call. There appears to be a decrease in the value of the company since 2007.  

VoxMobili’s products include Phonebook 2.0, Phone Backup, Social Home and an SDK for syncing data. Most of these products are redundant as similar tools come pre-loaded in smartphones these days. The last time OnMobile mentioned VoxMobili was in 2012 concall when it said that the company plans to being some data products made by the French unit to India.

The decision to sell VoxMobili comes after Onmobile had reported a net profit of Rs 3 crore on revenues of Rs 204.3 crore for the quarter ending December 31st 2013 (Q3-FY14), down from net profit of Rs 10 crore on revenues of 206.9 crore. Last quarter, its India revenues were impacted by the TRAI’s double confirmation guidelines, which had led to a 60% drop in VAS activations in the industry. Also, internationally its revenues decreased 2.7% due to softness in Latin America (LatAm), Egypt and Bangladesh quarter on quarter.

More recently, Onmobile’s promoter co decided to buy back shares worth Rs 47.6 crore (around $7.6M). Note the exit of Rajesh Kunnath as OnMobile Global CFO earlier this year. 

Onmobile’s acquisitions

– ITFinity in 2006, initially paying Rs 19.5 Cr for 51%, and the rest through stock allocation to ITFinity founders. details in the DRHP.
– Voxmobili in 2007 for $35.12 million. Read more.
– Telisma in 2008 for $18 million. Read more.
– Dilithium Networks in 2010. Read more. Note: the amount paid for this acquisition appears to have been undisclosed.
– Livewire Inc in 2013 for $17.8 million. Read more.

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