Synchronoss (NASDAQ:CNCR) announced today that it is acquiring the personal cloud assets, Younited, from F-Secure for $60 million in cash. As part of the deal, Synchronoss will also have the ability to integrate and sell F-Secure security products along with its Personal Cloud offering, creating additional monetization opportunities. Upon closing, Synchronoss will service over 75 mobile operators, including 9 tier one global providers, and have an addressable base of over 3.5 billion subscribers (vs. 3 billion as of 3Q14) for its cloud platform. Additionally, management expects the deal to be neutral to slightly accretive in 2015 and will provide additional details during the 4Q earnings call on February 5, 2015. The deal is expected to close at the end of 1Q15.
Synchronoss currently has 2/3 of AT&T’s cloud business and will acquire the remaining 1/3 through this acquisition. With all three pieces of AT&T’s fragmented cloud, Synchronoss is well positioned to convert this business into a comprehensive cloud deal. The company’s strategy is similar to the approach it took at Verizon where Synchronoss was able to acquire FusionOne (for the network address book) and NewBay and subsequently expand the relationship into a comprehensive cloud deal for all data classes.
Shares of Synchronoss closed yesterday at $45.14. CNCR has a 1-year high of $54.05 and a 1-year low of $25.28. The stock’s 50-day moving average is $41.86 and its 200-day moving average is $43.15.
On the ratings front, 5 research analysts have assigned a Buy rating on the stock, and the average price target is $56, which implies an upside of 25% from current levels.