LivePerson (LPSN) to Acquire Contact At Once!; Updates Outlook

LivePerson (NASDAQ: LPSN) announced that it has entered into a definitive agreement to acquire Contact At Once!, LLC ("CAO" or "Contact At Once!"), a software company with a cloud-based platform that connects consumers to businesses across a variety of websites through chat, mobile and video.

Contact At Once! is the leading chat provider in the automotive industry with a customer base that includes over 13,000 dealerships, many auto manufacturers and most major car search and advertising sites. The company is also making early inroads into the real estate industry, particularly in the multi-family apartment rentals and homebuilder verticals. CAO's unique platform enables a consumer to initiate a chat with a merchant from a variety of search, content aggregation, and other multi-listing websites.

Under the merger agreement for the transaction, LivePerson will acquire all of the outstanding equity interests of Contact At Once! for an aggregate purchase price of $65 million, consisting of approximately $43 million of cash and $22 million of common stock. CAO may also receive up to $5 million of contingent consideration subject to achieving certain targeted financial, strategic and integration objectives and milestones.

"We welcome CEO John Hanger and EVP Strategy Marc Hayes, their successful team of 170 employees and the company's impressive roster of customers," said LivePerson CEO Robert LoCascio. "CAO's technology is unique because it enables for the routing and tracking of the chat from multiple websites directly to an individual business through a single user interface. Their technology and vision align strongly to our core strategy of enabling a greater number of consumers to engage businesses in real-time from any digital channel, across any device. With our combined customer bases and platform capabilities, we see a lot of opportunity for growth into new and existing verticals."

Since its launch nearly ten years ago, Georgia-based CAO has set a strong record for execution, delivering thirty three consecutive quarters of revenue growth. The company is uniquely positioned with patented technology that enables the embedding of two-way communication systems within online advertisements and search results. In one study of auto dealer websites in 2013, Contact At Once! chat was shown to help increase the number of leads generated by nearly 80%. Customers have also reported increases in the number of leads generated from online ad listings after engaging CAO's platform.

"We are excited about joining forces with LivePerson, a company that consistently demonstrates technology leadership in the arena of proactive consumer engagement, driven by a patented behavioral targeting engine," said Contact At Once! CEO John Hanger. "Our customers will benefit from LivePerson's financial strength and commitment to innovation. We also look forward to leveraging the synergies of our combined customer bases and capitalizing on the Company's international infrastructure to expand overseas."

Financial Outlook

CAO is expected to contribute $3.0 million of revenue to LivePerson in the fourth quarter of fiscal 2014 stub period and to be accretive to LivePerson's revenue growth rate in 2015. LivePerson expects CAO to be accretive to earnings on a non-GAAP basis in its first year. LivePerson anticipates approximately $1.5 million of deal costs and amortization of purchased intangibles in the fourth quarter of 2014.

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