Twilio (NYSE:TWLO) stock is on the rise Monday following merger and acquisition (M&A) news that it’s acquiring Segment for $3.2 billion.
Twilio won’t be spending cash to acquire the cloud data company. Instead, it’s going to fund the entirety of the $3.2 billion purchase price with shares of TWLO stock. This will have Segment becoming a division of Twilio.
Twilio notes that the deal will improve its customer engagement offerings to developers and companies. It will also increase its total addressable market to $79 billion. It notes that this should speed up its growth plans.
Jeff Lawson, co-founder and CEO of Twilio, said the following about the M&A news.
“Combined with Twilio’s Customer Engagement Platform, we can create more personalized, timely and impactful engagement across customer service, marketing, analytics, product and sales. We are thrilled to welcome Segment to the Twilio team.”
Twilio points out that the transaction has the support of both companies’ Boards of Directors. The deal still needs to complete customary closing conditions before completion. That includes approval from regulators and shareholders. So long as there’s no trouble in these areas, the deal is on target to close in the fourth quarter of 2020.
The deal has Twilio getting financial advice from Morgan Stanley and legal advice from Cooley LLP. Segment’s financial and legal advisors for the deal are Qatalyst Partners and Goodwin Procter, respectively.
TWLO stock was up 7.5% as of Monday afternoon.
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article.