Tuesday, December 20, 2011

Tangoe dips $23.5M into ProfitLine purchase

By Rodney H. Brown

Fresh off its summertime IPO, Connecticut communications software company Tangoe Inc. paid $23.5 million Monday to buy ProfitLine Inc., a provider of telecom expense and mobility management services.

Orange-based Tangoe (Nasdaq: TNGO) said in a release that it paid cash for San Diego-based ProfitLine, with $14.5 million paid up front and $4.5 million being paid each at 12 months and 18 months after Monday’s close. According to a statement in the release by Al Subbloie, president and CEO of Tangoe, buying ProfitLine “expands our customer base, broadens our vertical coverage, and provides an attractive cross-sell opportunity.”

Specifically, Profit Line provides a software suite focused on management of fixed and mobile telecom expenses and mobile device management. Over the course of 2012, Tangoe said that it expects ProfitLine to bring in revenue of between $14 million and $15 million.

In July, Tangoe held its initial public offering, raising $75 million, by selling 8.77 million shares at $10 per share.  The company first announced the plans for an IPO in April 2010. Venture backed Tangoe’s last round was a $13.5 million Series F round in August of 2008. Backing VC firms included Edison Venture Funds, which owns 21.5 percent of the company; Sevin Rosen Funds, which has 16.8 percent; Investor Growth Capital which controls 12.4 percent; and North Atlantic Capital with 9.9 percent ownership.

Tangoe purchased Waltham-based Internoded Inc., a maker of mobile device management software, in January of 2009 for an undisclosed amount.