Carlyle-Backed Syniverse Is in M3-Brigade SPAC Merger Talks

(Bloomberg) -- Syniverse Technologies LLC, a messaging company that has been owned by Carlyle Group Inc. since 2011, is in talks to go public through a merger with M3-Brigade Acquisition II Corp., according to people with knowledge of the matter.

M3-Brigade is seeking new equity to support a transaction that’s set to value Tampa, Florida-based Syniverse at about $3 billion including debt, one of the people said. In March, Twilio Inc. agreed to invest as much as $750 million in Syniverse ahead of a potential public listing. Syniverse has about $1.9 billion in debt, data compiled by Bloomberg shows.

“The company’s operating performance, which was already weak entering 2020, deteriorated further, hurt by the pandemic,” Moody’s Investors Service wrote in a March note, citing a 13.3% decline in revenue in the 12 months ended Nov. 30. The ratings agency said it doesn’t expect Syniverse’s top line to return to pre-pandemic levels until 2022.

Carlyle and M3-Brigade representatives declined to comment. A Syniverse spokesperson didn’t immediately respond to a request for comment. Terms may change and as with any transaction that’s not yet finalized, it’s possible talks could fall apart.

Syniverse, led by Chief Executive Officer Andrew Davies, provides messaging and other software and services to clients such as Bank of America Corp., Twitter Inc. and T-Mobile US Inc., its website shows.

M3-Brigade is a SPAC led by CEO Mo Meghji that raised $400 million in a March initial public offering. It said it expects to focus on North American businesses or companies that have been hit by the pandemic, or renewable- energy firms. The SPAC is affiliated with financial advisory firm M3 Partners LP and credit-focused investment firm Brigade Capital Management LP.

M3’s first SPAC reached a deal in 2017 with IEA Energy Services LLC, a renewable-energy engineering and construction firm, to take it public.

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