Wow, first Howard Bubb left Intel/Dialogic, Mike Ross left Aculab, and now Eric Giler is leaving Brooktrout. This may leave Brough Turner at NMS as one of the last holdouts in the CTI/VoIP media processing market. I should point out that we still have Peter Karneef and Jim Pinard at Pika Technologies and of course Allan Pound the founder of Aculab who has recently been much more visible in the market since the release of the company’s Prosody X board is also a well-known industry veteran.
More recently there are other strong players in this space as well like AudioCodes, Eicon ad Spirit DSP.
What prompted Eric to leave Brooktrout is unknown (he looks as healthy as ever and I’ve known him since around 1990) but an acquisition of Brooktrout by Excel provided an opportunity for him to move on. Eric has always been great to work with and the industry will feel his loss.
The competitive landscape of the media processing board market also known as the DSP resource board market hasn’t changed too much over the years but we used to have Dialogic, NMS, Rhetorex, Pika and Brooktrout all competing had to head. It was vicious competition but also civil.
These companies used to try to outdo each other at events like the Computer Telephony show over the years. It was fun to watch and report on.
Rhetorex changed hands a few times and eventually got picked up by Brooktrout. Dialogic got picked up by Intel. And now this.
One wonders what the reason was for Brooktrout to sell. They seem to be doing well – especially with their SnowShore division. They had lots of activity at their booth at the recent TMC VoIP Developer Conference as well.
Here are some excerpts from the release that might shed some light on the issue:
"We are pleased to announce this strategic transaction, which provides
great value to our stockholders," said Eric Giler, CEO of Brooktrout. He
continued, "This transaction also offers Brooktrout a unique opportunity to
better serve the current and future needs of its customers and partners."
Marc Zionts, CEO of Excel, said, "This combination will help us create one
of the largest, broadest, and deepest enabling technology product lines in the
communications equipment industry. Together, Excel and Brooktrout will be
better able to address customers’ needs, providing them with a wide variety of
choice from a single, world-class vendor. Our increased scale will hasten the
development of new features and platforms and better serve the efforts of our
partners to quickly and efficiently bring new products and services to
market."
Management of Brooktrout will remain committed to working diligently to
meet all customer needs. Following the closing, Mr. Zionts will serve as CEO
of both Brooktrout and Excel.
The transaction will be financed through a combination of equity
contributed by investors in EAS Group including Oak Investment Partners,
TowerBrook Investors, L.P., and Anshutz Investment Company, with debt
financing provided by Comerica Bank. The board of directors of Brooktrout has
approved the transaction and recommended to Brooktrout’s stockholders that
they adopt the agreement. The transaction is subject to various conditions,
including approval by the stockholders of Brooktrout and other customary
closing conditions. A special meeting of Brooktrout’s stockholders will be
scheduled as soon as practicable following the preparation and filing of proxy
materials with the SEC.
EAS Group’s investors include Oak Investment Partners, TowerBrook
Investors, L.P., and Anshutz Investment Company.
Jefferies Broadview, a division of Jefferies & Company, Inc., acted as
financial advisor to Brooktrout. Morgan Stanley & Co. Incorporated, acted as
financial advisor to EAS Group. Wilmer Cutler
acted as legal advisor to Brooktrout, and McDermott Will & Emery LLP acted as
legal advisor to EAS Group.
As Greg Galitzine points out in his blog entry, On the surface it actually makes sense. There’s not too much overlap between the two, and the coverage of enterprise and service provider (for the combined company) makes a great deal of sense. This purchase makes sense to me as well but I am looking forward to further clarification. Good luck to Eric and his team as well as the fine people over at Excel Switching. I wish you all continued success!
