A Canadian virtual event company has made a bold move to expand its global reach by acquiring key assets formerly owned by a unique American virtual events and collaboration solutions provider.
In a move to bolster its global market and technology footprint, Xcyte Digital Corp. (TSXV:XCYT), a leading global events technology company, has signed an agreement for sale of collateral with a Delaware limited liability company.
This agreement facilitated the acquisition of key assets previously owned by Streamlined Communications LLC, a U.S.-based provider of audio conferencing, collaboration solutions, webcasting, and virtual events.
A streamlined strategy
Under the terms of the agreement, a wholly owned subsidiary of Xcyte Digital acquired certain assets formerly owned by Streamlined Communications, including both technology and revenue-producing assets such as intellectual property, customer contracts, and essential business infrastructure. This acquisition marks a significant step forward for Xcyte in enhancing its product offerings and customer experience.
Streamlined Communications reported financials for the trailing 12 months ended August 31, 2024, showing revenue of US$3.6 million, a Gross Margin of 50.6 per cent, EBITDA of US$1.3 million, and Net Earnings of US$917,126 with no Net Loss. The company had total assets of US$6.0 million and liabilities of US$6.0 million. Xcyte is assuming only some of these assets and none of the liabilities. It is important to note that the revenue and EBITDA realized by Xcyte may differ from Streamlined’s reported results due to various factors, including the nature of existing contracts and the lack of definitive assignment language.
The total transaction consideration for Streamlined Communications’ assets amounted to US$3.56 million. This included US$3 million in cash, funded by existing Xcyte shareholders through two tranches of subordinated debt financing: US$1.9 million with an annual interest rate of 12 per cent and an 18-month term, and US$1.1 million with an annual interest rate of 12 per cent and a 36-month term.
Management’s take
“The addition of Streamlined Communications’ assets including its innovative platform and experienced team will enhance our product offerings and customer experience,” Xcyte’s CEO, Randy Selman, explained in a media release. Our clients will gain access to a state of the art, cloud-based system offering a robust set of features.
Some of these features include automated scheduling, instant post-event deliverable generation, efficient booking during peak periods with blackout dates, integration with popular web conferencing tools such as Zoom and Webex, API support for easy connection to other reservation systems, and seamless scalability through distributed cloud infrastructure.”
Besides a revenue and EBITDA improvement, CEO Selman noted in an exclusive interview with The Market Online Watchlist that this acquisition brings with it the ability to integrate several company divisions around a single platform.
“In the long run, the clients of Streamlined, the assets we’ve acquired, are going to use the services of Xcyte Digital,” he said. “We are going to see a lot of cross-marketing, and I think there is going to be instant growth in the revenues for the company as a result.”
Click the video below to watch the interview in full.
Investment corner
This transaction also positions Xcyte for substantial growth in international markets, deepening its presence in North America, the U.K., Singapore, and Australia.
Xcyte Digital Corp. specializes in next-generation event solutions, providing innovative and comprehensive technology for virtual and hybrid events. This acquisition underscores Xcyte’s commitment to expanding its capabilities and delivering exceptional value to its clients worldwide.
You can find more on Xcyte Digital Corp. at its website, xcytedigital.com.
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