ShoreTel, Inc. completed the acquisition of Corvisa LLC from Novation Companies, Inc..
This acquisition is expected to accelerate ShoreTel's fiscal 2017 hosted revenue growth at around 30% by enhancing ShoreTel's solutions and architecture. ShoreTel expects the ongoing impact of the acquired Corvisa business in the first 90 days of operations to reduce its non-GAAP operating profit by approximately $3.5 million. The GAAP operating results will also be impacted by an additional $1 million related to one-time deal expenses in the third quarter of 2016. Based on its current expectations and factoring in the impact of the Corvisa acquisition, ShoreTel expects to return to non-GAAP operating profit in the quarter ending June 2016. Stifel, Nicolaus & Company, Incorporated acted as financial advisor to Novation Companies. Adam W. Finerman of Olshan Frome Wolosky LLP acted as legal advisor for Novation. Jeffrey R. Vetter of Fenwick & West LLP acted as legal advisor for ShoreTel.
ShoreTel, Inc. (NasdaqGS:SHOR) completed the acquisition of Corvisa LLC from Novation Companies, Inc. (OTCPK:NOVC) on January 6, 2016. $7 million was paid on closing and $1 million will be kept in escrow for a period of twelve months to secure certain indemnification obligations of Novation and $0.35 million will be kept in escrow to secure certain obligations of Novation in connection with the post-closing working capital adjustment. Matthew Lautz, Chief Information Officer and Vice President of Novation and Chief Executive Officer of Corvisa, resigned from his positions.