Persistent Unit To Acquire US-Based Starfish Associates For $20.7 Mln

Persistent Systems Ltd.’s subsidiary agreed to acquire US-based Starfish Associates LLC for $20.7 million in cash to strengthen its position in artificial intelligence-powered contact center and unified communications.

The New Jersey-based Starfish, founded in 2005, is a global software company providing enterprise communication solutions to the world’s largest enterprises, including Fortune 500 companies, the Indian IT services provider said in a stock exchange announcement.

Starfish, which offers solutions in the unified communications and contact center ecosystem, has built an automation platform that helps enterprises streamline the management of communication systems. The company helps enterprises with automated provisioning, self-service, resource management, and migration tools.

Persistent Chief Executive Officer and Executive Director Sandeep Kalra said the integration of Starfish’s platform greatly enhances the company’s unified communications and contact center management offerings as this industry undergoes significant disruption on the back of AI-led innovations.

“This acquisition paves the way for us to support our global clients to unlock the full potential of these innovations in their contact centers,” he added.

DEAL DETAILS

The company’s unit Persistent Systems Inc. signed an agreement on 2 July to acquire Starfish for a total of $20.7 million.

The deal involves an upfront payment of $15.4 million to Starfish’s shareholders, subject to customary adjustments for working capital, debt and cash on closing. The sellers will also be eligible for a maximum cumulative earnout of $5.1 million over the next two years, contingent on achievement of certain performance thresholds.

In addition, certain key Starfish employees will be eligible for a total retention payment of $200,000 over the next two years, subject to employment continuity.

Persistent said the acquisition will likely be completed within four-to-six weeks, subject to the satisfaction of customary closing conditions. Upon closing, Persistent Systems will own a 100% stake in Starfish.

Starfish reported a revenue of $8.2 million in the 12 months ended 31 March 2024, according to the statement.

Note: $1 = 83.4920 Indian rupees

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