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October tends to be a big month for global marketing supremo Jim Machi and his colleagues at Dialogic, the Milpitas, California-based provider of bandwidth optimising and video-enabling technologies.
Exactly one year ago the company signed off its merger with Veraz, a transformational acquisition that gave Dialogic access to the high-end carrier market for the first time, as well as a listing on NASDAQ.
It follows a long line of other defining deals that have also taken place in the same month, starting with the company’s demerger out of Intel in 2006, and the acquisitions of Cantata in 2007 and NMS in 2008.
This year, there was no big ticket deal, but rather an upbeat message confirming the completion of Veraz’s integration, news of the appointment of a new chief financial officer and a bullish research note from Oppenheimer, the investment banking boutique, suggesting that strong growth in mobile IP traffic could push Dialogic’s shares to more than triple their current value ($1.91 a share at the time of writing) over the next 12 months.
Machi, an engineer by trade, believes that should be more than enough to keep the newshounds at bay. “We’ve done our fair share of deals over the last few years and I have been lucky enough to be involved in all of them. While they are extremely interesting to work on, there comes a time when you have to grow the business organically as well,” he says.
To be sure, the new-look Dialogic has a comprehensive portfolio of both multimedia processing infrastructure, including media server platforms, VoIP gateways, video gateways, session border controllers and call control infrastructure. “We have been very active in the M&A market, and are trying to grow the company in a way that will allow us to participate in what I like to call the advanced networks space.”
Machi will not be drawn on the prospects for further deals and cautions against drawing assumptions from the recent appointment of John Hanson, the former chief financial officer at One Communications, to the same role at Dialogic. “If you look at stock market valuations in general, there are still very definitely deals to be done, but that is somewhat tempered by trepidation over the health of the economy,” Machi says. As to the appointment of Hanson: “He has a long and established career as a CFO both at publicly listed and privately held companies and that can only be extremely good for us.”
The future, Machi says, looks bright: “The telecoms space is a very dynamic market right now – there’s a lot of balls out there that you might want to try to keep in the air including developments in cloud computing, 3G and 4G.”
