Amdocs has announced that it has entered into a definitive agreement to acquire the service assurance business of TEOCO. The acquisition will enable Amdocs to provide service providers with a unique end-to-end service orchestration offering, assuring the quality of service and enabling the monetization of next-generation dynamic customer experiences.

Amdocs is acquiring the service assurance business of TEOCO for a consideration of approximately $90 million in cash, subject to the satisfaction of the conditions to closing. Additional consideration may be paid later based on the achievement of certain performance metrics. Revenue from TEOCO is expected to be immaterial in fiscal 2023 and expected to add approximately 0.5 per cent to total revenue in the fiscal year 2024.

The impact on generally accepted accounting principles (GAAP) diluted earnings per share (EPS) will not be known until after Amdocs completes the purchase price allocation. The impact of the acquisition on Amdocs’ non-GAAP diluted earnings per share is expected to be neutral in the full fiscal years 2023 and 2024. Non-GAAP diluted earnings per share excludes amortization of purchased intangible assets and other acquisition-related costs, changes in certain acquisitions related liabilities measured at fair value, restructuring charges, equity-based compensation expenses and other, net of related tax effects.

Commenting on the development, Shuky Sheffer, president and chief executive officer, Amdocs Management Limited, said, “The move will enhance Amdocs’ offering by bringing key assurance expertise and capabilities in-house, enabling us to offer truly end-to-end service orchestration. In today’s dynamic and complex 5G era, such a holistic, end-to-end approach is key to delivering on the promise of amazing experiences our customers’ end users expect. Amdocs and TEOCO already partner in some opportunities within the service assurance domain, and this acquisition and the new seamlessly integrated offering will enable us to better serve existing and new customers.”