There is no doubt that the events of September 11th have had a dramatic impact on the United States. As a nation, we are still coming to grips with this tragedy, and we are struggling with a number of issues, including the impact that these events will have on our economy and capital markets. All of our clients and prospects have been asking us similar questions – “how do these tragedies impact the current atmosphere for M&A and what, if anything, should we be doing in light of the changed economic environment?” While every deal is unique, and certainly requires specific advice and guidance, we can speak loosely to those trends and factors that seem to be reverberating throughout the M&A and financing world.

Although Voice over Internet Protocol (VOIP) technologies have yet to gain the widespread acceptance originally predicted, the value proposition offered by many VOIP service and technology providers is leading industry analysts continue to expect a boom in VOIP technology and strong financial stability amongst VOIP providers in the near future.  VOIP traffic is projected to account for approximately 75 percent of the world’s voice traffic by 2007, according to Frost & Sullivan.  In the past 12 months VOIP service and technology providers have suffered financially, along with other telecom and Internet-related companies, and multiple VOIP companies lost 90 percent of their stock value.  However, the poor financial situation forced VOIP providers to re-examine their business models and many companies have experienced stabilized stock prices and have attained a clear path to profitability. 

This article focuses on the corporate elearning market. More specifically, we offer a brief industry definition, the segment’s size and anticipated future growth, the critical success factors and key M&A trends that Mirus believes all middle market players must internalize. The article's primary objective is to provide interested parties some strategic food for thought and suggested course of action. Mirus views the fact that there are recent transactions, albeit at relatively low valuations, despite an anemic M&A market, as proof that industry leaders are moving rapidly to distance themselves from the pack. But more importantly, smaller to mid-sized players will need to make their cases as to why they deserve a seat at the rapidly consolidating corporate elearning table before the music stops and there are no seats remaining.