Blackboard Acquires Elluminate and Wimba
Blackboard Inc. announced today that it will be acquiring both Elluminate Inc. and Wimba Inc. Elluminate and Wimba offer advanced virtual classroom technology that allows education institutions to hold synchronous live courses over the Web, including audio, video, white board and social learning capabilities. The technologies are used to supplement traditional courses, to support full distance learning courses, and to facilitate a variety of other collaborative interactions including virtual office hours, team meetings, professional development, student projects and mentoring and tutoring opportunities. A total of about $116 million in cash for both properties.
Blackboard and the two properties will form Blackboard Collaborate. It will be a standalone platform in the company’s education solutions. A quote from the Blackboard CEO Michael L. Chasen:
“We’ve heard directly from our clients that this technology has become increasingly fundamental to the learning process for the online course experience and beyond. Collaboration technology is joining the range of solutions that our clients are leveraging to support and improve the teaching and learning experience. We expect this will grow as institutions look for cost-effective ways to encourage social learning and support learning interactions of all kinds.”
With online education on the rise this move will definitely put Blackboard way head in the game. With just about every which way you are able to receive an education Blackboard now has it.
“Bringing Elluminate and Wimba together allows us to accelerate development of their technologies to better realize the full potential for impacting education — at a rate much faster than any of our organizations could have achieved independently,” said Ray Henderson, President of Blackboard.
From the press release:
Financial Details of the Elluminate and Wimba Acquisitions
Both Elluminate and Wimba’s business models include annual subscription and perpetual offerings. The companies’ subscription models offer many of the same financial characteristics as Blackboard’s, including an annual recurring subscription-based licensing model, ratable revenue recognition, a stable institutional client base and strong renewal rates. As a result, the combination is expected to enhance growth and profitability over time.
Blackboard management currently expects that the combined Elluminate and Wimba transactions will contribute approximately $6.0 million to Blackboard’s full year 2010 GAAP revenue, assuming the anticipated early August closing date for the acquisitions. At the time of the acquisition announcement the combined companies had a contract value(1) of approximately $27 million. The Company expects the acquisition to be dilutive to full year 2010 by approximately ($0.33) to GAAP net income per diluted share and by approximately ($0.25) to non-GAAP net income per diluted share. Management estimates that there will be approximately ($0.14) of dilution in full year 2010 to non-GAAP net income per diluted share primarily related to the purchase accounting adjustments to Elluminate and Wimba’s deferred revenue and approximately ($0.04) of additional dilution in full year 2010 to non-GAAP net income per diluted share related to the timing of non-recurring integration costs.
Blackboard expects the transaction to be accretive in 2011 by approximately $0.05 to full year earnings on a pro forma non-GAAP net income per diluted share adjusted basis excluding the impact of purchase accounting adjustments on deferred revenue and non-recurring merger-related costs. The Company expects the acquisitions to contribute approximately $30.0 million to Blackboard’s full year 2011 GAAP revenue and the Company expects the acquisition to be dilutive to full year 2011 by approximately ($0.25) to GAAP net income per diluted share and by approximately ($0.05) to non-GAAP net income per diluted share.
