Verint: Can I Get a Witness?
Verint Systems, the provider of analytics solutions for security and business intelligence, today announced plans to acquire Witness Systems, a workforce optimization vendor, marking a red-letter day for the contact center solutions industry. The marriage of these two giants stands as a move toward more serious consolidation, indicating the growth in the market. The acquisition, which is expected to close by the second quarter of 2007, will cost Verint $27.50 in cash per share for Witness. The total enterprise value of the transaction is approximated at $950 million. The merger will help Verint complement its current solutions and strengthen its focus on the contact center, following its acquisition of Mercom, the provider of interaction recording and performance evaluation tools, in July 2006.
"This does make sense for the market and this does make sense for Verint," says Donna Fluss, principal of DMG Consulting. Fluss notes that currently, Nice, Witness, Verint, and Autonomy/Etalk stand as the top vendors in the workforce optimization industry. She says, "Having there be mergers at the top makes sense and is a sign of a mature but strong marketplace." A combination of the Witness and Verint solutions will also help to make Verint a stronger competitor in this space. Over the last few years, Verint has increased its effort in its growing security business; however, this acquisition shows that the company will continue to stay focused on its contact center offerings.
Mariann McDonagh, vice president of global marketing for Verint, says of the acquisition, "When we bring these two together to make a new vision, what we really see is how the two strategies complement each other," citing Verint's core strategy as actionable intelligence and Witness's as workforce optimization. According to McDonagh, Verint's actionable intelligence can help WFO make smarter decisions, while Witness's workforce optimization capabilities will help to improve the service value chain from enterprise to customer. McDonagh adds that the vision going forward will center on customer value and a goal of providing a broad range of options for bettering customer service.
Although Fluss says that Witness's and Verint's offerings overlap more than the two companies are professing, there will be changes and expansions in product offerings. Because of the size of this acquisition relative to the size of the market, the merger stands to propel Verint into becoming the biggest player in the market, both in regards to revenue and depth of functionality. Fluss says that this is both natural and significant. "It's a really normal, expected market consolidation, but it does change the dynamic of the market."
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