Twilio Acquires SendGrid for $2 Billion
If you thought all of the younger communications companies were in the business of killing email, think again. Ahead of its annual Signal user conference taking place later this week, Twilio yesterday announced that it has entered into a definitive agreement to acquire SendGrid, an email API platform for customer engagement.
The deal is an all-stock transaction valued at roughly $2 billion. With an exchange rate of 0.485 shares of Twilio Class A common stock per share of SendGrid common stock, the price equals approximately $36.92 per share based on yesterday's closing prices, Twilio said. The exchange rate represents a 14% premium over the average exchange ratio for the 10 days preceding yesterday's announcement.
In acquiring SendGrid, Twilio will be able to deliver a cloud communications platform for all channels -- voice, messaging, video, and now email. "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 Twilio CEO Jeff Lawson in a prepared statement.
Twilio and SendGrid "share the same vision, the same model, and the same values," Lawson said, with Twilio noting that the two companies together drive more than 500 billion customer interactions annually.
The Twilio and SendGrid boards of directors have already approved the deal, which is expected to close in the first half of 2019 following customary closing proceedings and shareholder approval. Under the terms of the transaction, Twilio Merger Subsidiary, a wholly-owned subsidiary of Twilio, will merge with SendGrid, and SendGrid will survive as a wholly-owned subsidiary of Twilio, the company said. Both SendGrid and Twilio will report their financial results in early November for their third fiscal quarters, ended Sept. 30, and Twilio will provide financial guidance for the combined company following the close of the acquisition.
This email acquisition follows a similar move from Slack, which last month announced its acquisition of email app provider Astro. Taken together, these moves could be the start of a newfound embrace of the email channel after years of hearing from vendors about email's inevitable death.