Consolidated Revenue in the Upcoming Fiscal Year Expected to Exceed $45 million

MARKHAM, ONTARIO, June 20, 2017 – Sangoma Technologies Corporation (TSX VENTURE:STC), a trusted leader in delivering Unified Communications solutions for SMBs, Enterprises, OEMs, and Service Providers, both on-premises and in the cloud, today announced the planned acquisition of VoIP Supply LLC.

VoIP Supply, the ‘Everything You Need for VoIP’ company, is based in Buffalo, New York, and is one of the industry’s most successful, well known, and respected channel partners.  It has been providing customers in North America with one-stop shopping for a complete range of telecom solutions from leading manufacturers, for over 15 years.

“We are always looking for ways to prudently add scale to our business”, said Bill Wignall, President and CEO of Sangoma.  Wignall continued, “VoIP Supply is one of our top channel partners in the US for both premise-based as well as cloud-based solutions, so their very strong online presence, web traffic, and ecommerce/inside-sales model will be an excellent strategic addition to our business.   Further, this acquisition will provide Sangoma even closer contact with key resellers, system integrators, and end-users, deepening our relationships with these important clients.  I would like to personally welcome all the VoIP Supply employees to the growing Sangoma family and I look forward to contributing to VoIP Supply’s long history of successfully serving the needs of their customers.”

The transaction is subject to standard closing conditions and is expected to close in early July 2017.

“When I started VoIP Supply in 2002”, said Ben Sayers, founder and CEO of the company, “it was with a vision of offering full communications solutions to businesses, by leveraging the growing importance of the internet to provide information and purchase options.  This was at a time when only 5-10% of people had broadband access in the US.  Sangoma is one of the few companies in our industry that understands that vision and I’m very pleased to see VoIP Supply become part of a larger, thriving business with more resources, one that is committed to taking excellent care of our loyal customers and our dedicated staff.”

VoIP Supply, which is profitable, will operate as a separate subsidiary of Sangoma with the appropriate autonomy that distribution businesses require.

“Putting together a manufacturing and a distribution business requires a careful balance,” said Tony Lewis, COO of Sangoma. “That is critical to ensuring that each company obtains the intended benefits, while still maintaining the independence that VoIP Supply needs to continue its long track record of proven success.  This particular acquisition is quite unique to this specific situation in the US.  In other countries, we rely heavily upon the local language, culture, reputation, and customers that our valued partners in those regions offer and look forward to continuing the strong, mutually beneficial relationships we’ve built together over many years.”

Following the closing of the acquisition, VoIP Supply’s current President, Paula Griffo, will continue to lead the company on a permanent basis, providing stability and reassurance to VoIP Supply’s employees, suppliers, and customers.

“I am very excited about Sangoma’s ownership bringing a new level of energy, commitment, and opportunity to the business,” said Paula Griffo.  “Telecom is a competitive industry, so having the expanded resources and capabilities of a larger, growing, successful company like Sangoma is really going to help our excellent team here meet the needs of even more customers, in new and innovative ways.  And I would like to take this opportunity to strongly reassure our valued manufacturing partners and suppliers that our commitment to you is unwavering.  VoIP Supply will continue to sell the broadest mix of products from the top manufacturers in the industry and after extensive discussions with Sangoma, I’m very pleased to confirm that our new owners fully embrace and support this strategy.”

Terms of the transaction will be more fully described in subsequent disclosures as required, but in summary, Sangoma is acquiring all of VoIP Supply from its LLC members.  For all the membership interests in VoIP Supply LLC, Sangoma will pay initial consideration of US$3.0 million in cash, issue 993,627 common shares for a deemed value of US$0.6 million (at C$0.80/share), and enter into an agreement for contingent consideration of up to US$0.4 million if certain targets are achieved in the first year post closing.  In conjunction with this transaction, Sangoma has extended the company’s borrowing capability with its current Canadian bank from C$2.5 million to C$4.5 million.

Outlook for fiscal years 2017 and 2018
The purchase of VoIP Supply will close shortly after the end of Sangoma’s fiscal year 2017, and so will have no material impact on Sangoma’s financial results for the current fiscal year that will end in two weeks on June 30.  As a result, previously issued guidance and commentary on revenue and EBITDA for fiscal 2017 remains unchanged.

For the fiscal year 2018, Sangoma has previously provided guidance and committed to updating that guidance at the time it releases full year results for fiscal 2017. The company expects that in fiscal 2018, the acquisition of VoIP Supply will be accretive, will add over C$15m in revenue to Sangoma, and will result in total revenue in excess of C$45 million.

More detailed guidance, updated for the VoIP Supply acquisition, will be provided at the time the company releases it’s fiscal 2017 financial results.

Transaction Advisor
INFOR Financial Inc. acted as the financial advisor to Sangoma in connection with the acquisition of VoIP Supply.

Conference Call
President and CEO, Bill Wignall, and David Moore CFO will discuss this acquisition more fully on a conference call Thursday June 22nd 2017, at 4pm Eastern Daylight Time. The dial-in number for the call is 1-800-319-4610 (International 1-604-638-5340) and investors are requested to dial in 5 to 10 minutes before the scheduled start time and ask to join the Sangoma call.

About Sangoma Technologies Corporation
Sangoma Technologies is a trusted leader in delivering value-based Communications as a Service (CaaS) solutions for businesses of all sizes. Sangoma’s cloud-based Services include Unified Communication (UCaaS) business communications, Meetings as a Service (MaaS), Communications Platform as a Service (CPaaS), Trunking as a Service (TaaS), Fax as a Service (FaaS), Device as a Service (DaaS), and Access Control as a Service (ACaaS), Managed Internet Access, Managed Security, Managed SD-WAN. In addition, Sangoma offers a complete line of communications Products, including premise-based UC systems, a full line of desk phones and headsets, and a complete connectivity suite (gateways/SBCs/telephony cards). Sangoma’s products and services are used worldwide in leading UC, PBX, IVR, contact centers, carrier networks, office productivity, and data communication applications. Sangoma is also the primary developer and sponsor of Asterisk and FreePBX, the world’s two most widely used open-source communication software projects.
Cautionary Statement Regarding Forward Looking Statements

This press release contains forward-looking statements, including statements regarding the future success of our business, development strategies and future opportunities. Forward-looking statements include, but are not limited to, statements concerning estimates of future revenue, expected expenditures, expected future production and cash flows, and other statements which are not historical facts. When used in this document, the words such as “could”, “plan”, “estimate”, “expect”, “intend”, “may”, “potential”, “should” and similar expressions indicate forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements are based on the opinions and estimates of management on the date that the statements are made and involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other events contemplated by the forward-looking statements will not occur or will differ materially from those expected. Although Sangoma believes that the expectations represented by such forward-looking statements are reasonable based on the current business environment, there can be no assurance that such expectations will prove to be correct as these expectations are inherently subject to business, economic and competitive uncertainties and contingencies. Some of the risks and other factors which could cause results to differ materially from those expressed in the forward-looking statements contained in the management’s discussion and analysis include, but are not limited to changes in exchange rate between the Canadian Dollar and other currencies, the variability of sales between one reporting period and the next, changes in technology, changes in the business climate in one or more of the countries that Sangoma operates in, changes in the regulatory environment, the rate of adoption of the company’s products in new markets, the decline in the importance of the PSTN and new competitive pressures. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement and Sangoma undertakes no obligation to update forward-looking statements if circumstances or management’s estimates or opinions should change except as required by law. Readers are directed to Sangoma’s filings on SEDAR with respect to Management’s Discussion and Analysis of Financial Results for the basis of Sangoma’s reconciliation of EBITDA to net income as calculated under IFRS.


Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Sangoma Technologies Corporation

David Moore
Chief Financial Officer
(905) 474-1990 Ext. 4107

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