Today’s announcement by Amdocs on their USD 180 million purchase of Openet brings proven 5G charging and policy into the portfolio. The greatest impact of the deal is new customer logos. It also allows Amdocs to consolidate key accounts such as Bell.
At 2.5 times Openet sales revenue the deal can be considered cheap for Openet owners and investors. Openet was sidelined from an IPO years earlier by Amdocs in a long legal battle over patent infringement. Amdocs didn’t really need the technology. A technology buy would have fetched a much higher multiple.
Newcomers in the market like Microsoft and Servicenow could have forced Amdocs hand to prevent future competition in the 5G market.
The main plus of this acquisition is Opennet’s ready built cloud native charging and policy platform, which had a major upgrade in 2017, which allows Amdocs to capitalise on it’s recent decision to sign up for the Open Digital Architecture. This allows the company to focus more on it’s actual products offered rather than complicated multi faceted agreements.