InPhonic To Acquire VMC Satellite for $10.7 Million
InPhonic Extends Service Offering with Acquisition of Leading Online Marketer of Satellite Services
Washington, D.C. – April 21, 2005 – InPhonic, Inc. (Nasdaq: INPC), a leading online seller of wireless services and products, today announced that it has reached a definitive agreement to acquire certain assets of privately held VMC Satellite Inc., a leading online marketer of digital broadcast satellite services. The acquisition will enable InPhonic to expand its service offering, creating additional revenue opportunities from the over twelve million consumers that visit its portfolio of Web sites and marketing partners each month, while allowing VMC to continue to scale its business with the resources and expertise of InPhonic. InPhonic expects this transaction to be accretive to 2005 earnings.
The acquisition of VMC enables InPhonic to integrate a complementary service offering that will strengthen InPhonicâ€™s position as a leader in the growing market for online customer contract acquisition. This acquisition combines InPhonicâ€™s market leading position in online customer acquisition for the wireless industry with that of VMCâ€™s leadership in digital broadcast satellite. InPhonic also believes it will be able to combine its expansive online marketing channels along with VMCâ€™s 170,000 affiliates to sell wireless services to a broader online audience.
â€œThe acquisition of VMC Satellite will strengthen InPhonicâ€™s brand portfolio and allows us to leverage our e-commerce platform in a horizontal direction with a new product offering for the first time,â€ said InPhonic Chairman and CEO David A. Steinberg. â€œVMC allows InPhonic to offer the millions of visitors we attract each month to our Web sites additional buying opportunities, which we expect will further reduce our customer acquisition costs and improve the sales yield of our platform.â€
â€œThe VMC business model is an excellent fit with InPhonic, a company we have long admired,â€ said Rick Rahim, President and founder of VMC Satellite. â€œThe combination of these companies will allow VMCâ€™s marketing partners and customers to benefit from InPhonicâ€™s broad relationships with all of the major wireless carriers in the U.S., providing them with an expanded product offering and enhanced customer experience.â€
Based just outside of Washington, D.C., VMC is a leading online seller of digital broadcast satellite service for DISH Network.
InPhonic is also pleased to announce that VMC senior management will be retained including VMCâ€™s co-founders and brothers, Rick and Zee Rahim. Rick Rahim will be joining InPhonic as President of the new Satellite Services division. Zee Rahim will be joining InPhonic as the Senior Vice President for Operations for the new division.
InPhonic will pay cash and issue stock for an aggregate value of $10.7 million. At the closing, the shareholders of VMC will receive $3.5 million in cash and $7.2 million of InPhonicâ€™s common stock. The transaction is expected to be completed in the second quarter of 2005 and is subject to customary closing conditions. More information relating to the impact of the acquisition on InPhonic's 2005 financial performance will be provided at the time of the Companyâ€™s first quarter 2005 earnings release.
Headquartered in Washington, D.C., InPhonic, Inc. (NASDAQ: INPC) is a leading online seller of wireless services and products. InPhonic sells these services and devices, and provides world-class customer service through websites that it creates and manages for online businesses, national retailers, member-based organizations and associations under their own brands. InPhonic also operates Wirefly, a leading mobile phones and wireless plans comparison site that was awarded â€œBest of the Webâ€ by Forbes magazine in 2004. Today, InPhonic owns and operates Liberty Wireless, a leading MVNO and can deliver a full range of mobility solutions to enterprise clients through its Mobile Virtual Network Enablement (MVNE) platform. In 2004, InPhonic was selected #1 company of the year on the Inc. 500 – Inc. Magazineâ€™s list of the fastest-growing privately held companies in the United States. More recently, InPhonic was named T-Mobileâ€™s Internet Partner of the Year for 2004.
For more information on the company, its products and services, visit the InPhonic Corporate Web site at www.inphonic.com.
"Safe Harbor" Statement - Under the Private Securities Litigation Reform Act of 1995, this press release may contain forward-looking statements that involve risks and uncertainties. Important factors, which could cause actual operating results to differ materially from those in the forward-looking statements, are detailed in filings with the Securities and Exchange Commission made from time to time by the Company. This press release and statements are current as of the date of the individual announcements and the Company undertakes no obligation to publicly release any revisions to any forward-looking statement to reflect events or circumstances after the date thereof or to reflect the occurrence of unanticipated events.