KLR - Kaleyra: mGage Acquisition Analysis Including Conversation With CEO Dario Calogero

• Kaleyra on Feb 19th announced the acquisition of mGage, an enterprise messaging provider majority owned by Blackstone for $215 million.
• The CEO of Kaleyra was kind enough to answer a few of my questions regarding the deal that were not entirely clear in the acquisition conference call.
• The direct connection to all 4 US telecom carriers is a prized asset held by only 3 other companies and the margin profile of Kaleyra is set to improve dramatically.
• The post-merger company will instantly be much closer to the 40/30/30 US, EU & APAC/ROW revenue goal of the company and will be rife with cross and upselling possibilities.
• I am keeping my S/EV ratio target of 5, however with the added sales of mGage purchased at a shocking 1.26 S/EV, this allows my fair value target to increase all the way to $46.

For further details see: