Charlottesville's WillowTree Has Been Purchased For $1.225 Billion Dollars. Yes, You Read That Headline Correctly.

TELUS Corporation (T-TSX; NYSE-TU) and TELUS International (NYSE and TSX: TIXT), a leading digital customer experience innovator that designs, builds and delivers next-generation solutions, including AI and content moderation, for global and disruptive brands, announced today a definitive agreement to acquire WillowTree, a leading technology company founded in Charlottesville, Virginia.

Under the agreement, TELUS International will acquire WillowTree for a total enterprise value of US$1.225 billion, inclusive of US$210 million of assumed debt, of which US$125 million will be settled in TELUS International subordinate voting shares, approximately US$160 million will be reinvested by certain eligible management team members and settled subject to certain performance-based criteria, and the remainder will be paid in cash upon closing, according to a press release.

As part of the transaction, majority stakeholder Insignia Capital Group will sell its stake in WillowTree after initially investing in the company in 2018. The acquisition is anticipated to close in January 2023, and is subject to customary closing conditions and regulatory approvals.

“We are excited to share today’s news alongside TELUS International, announcing that we will unify our teams and missions to design, build and deliver premium, disruptive and human-centered outcomes for some of the most admired brands in the world,” said Tobias Dengel, CEO of WillowTree. “By combining the capabilities of these companies, we expect to be uniquely positioned to deliver frictionless, end-to-end user experiences, deploying a unified solution designed to allow our clients’ customers and employees to hop seamlessly among apps or websites, AI voice and bot engagement, and human voice or omnichannel support. What attracted us to TELUS International was the self-evident alignment that exists between our cultures and values, focused on an absolute premium and differentiated experience for all our employees and clients. Together, TELUS International and WillowTree will further elevate and cement our status as a premier global employer and destination for top tech talent by fostering rewarding, inspiring and sustainable environments for innovation and deep collaboration. We believe that our mutual and ongoing focus on these core elements will continue to be a significant competitive advantage that consistently produces differentiated and measurable outcomes that delight our clients.”

Founded in 2008, WillowTree is headquartered in Charlottesville, Virginia and today operates 13 global studios across the United States, Canada, Brazil, Portugal, Spain, Poland and Romania.

The company’s more than 1,000 strategists, designers, engineers and project managers partner with iconic brands on mission critical, large-scale initiatives, delivering world-class digital products that bridge the highest quality customer experiences with measurable performance.

WillowTree’s client roster includes Fortune 500 companies across key verticals including telecommunications and media, healthcare and life sciences, financial services, consumer goods, travel and hospitality, and technology and software. Select clients include FOX, CBC, PepsiCo, Anheuser-Busch InBev (AB InBev), Synchrony, Manulife and Marriott.

WillowTree has demonstrated strong financial growth and performance, with 2021 revenue of approximately US$140 million and strong profitability. Capital expenditures as a per cent of revenue for WillowTree is in the low single digits, driving meaningful free cash flow conversion that will help support rapid deleveraging.

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