Twilio Inc. (NYSE: TWLO) announced on Monday that it will acquire SendGrid in an all-stock transaction valued at approximately USD 2 Billion. SendGrid shares were trading 6.5% higher at the opening bell on Tuesday.
SendGrid operates a digital communications platform that helps enable businesses engage with their customers via email. The Company has processed over 45 Billion emails each month for both internet and mobile users.
Adding SendGrid to its portfolio expands Twilio’s communication channels. Twilio will now offer a more reliable and stronger voice, messaging, video and email communication. In total, the merger will reach over half a trillion customer interactions annually.
Twilio previously offered customers communication services predominately in channels like voice, text, chat and video, but the acquisition now expands it further by adding on email as another form of communication.
“Increasingly, our customers are asking us to solve all of their strategic communications challenges – regardless of channel. Email is a vital communications channel for companies around the world, and so it was important to us to include this capability in our platform,” said Jeff Lawson, Twilio’s Co-Founder and Chief Executive Officer. “The two companies share the same vision, the same model, and the same values. We believe this is a once-in-a-lifetime opportunity to bring together the two leading dev eloper-focused communications platforms to create the unquestioned platform of choice for all companies looking to transform their customer engagement.”
Under the agreement, at the exchange ratio of 0.485 shares of Twilio Class A common stock per SendGrid common stock, which equates to approximately USD 36.92 per share of Monday’s closing price.
Both companies are still expected to report their respective financial results on November 6th, 2018. Guidance for the combined company will be provided after the transaction has closed. The transaction is expected to close in the first half of 2019.