Quazar Capital Corporation is pleased to announce that their client, Minnes0ta-based Transcend Communications, Inc., has been acquired by Philadelphia-based Fastech Integrated Solutions with the support of Newspring Capital.
The Company: Transcend Communications, now known as Transcend United Technologies, is an IT and Communications Services provider for the mid-market. Started in 1984, Transcend designs, develops, deploys and supports IP Telephony and Internetworking Solutions over 3,000 customers.
The Situation: George Demou, President at Transcend, contacted Quazar for a meeting to discuss strategic options for Transcend; options discussed included recapitalization, adding additional investors, and the possibility of an outright sale. Quazar was retained to help find a solution for Transcend’s Shareholders.
Unique Challenge: Mid-way through Quazar’s assignment, Denny Hecker filed personal Bankruptcy; this left Transcend’s Board of Directors with questions of how to move forward in the best interest of the Company. When the bank found discovered the bankruptcy, they became concerned about how to treat Transcend’s borrowing relationship going forward; this created additional stress and confusion for the management team. The competition tried to take advantage of what appeared to be a fatal blow to the Company and its image in the marketplace. George Demou never waivered; he led his employees and shareholders through this very trying period with confidence and determination.
The Resolution: After weighing multiple options, Quazar presented offers to the Board including an offer from Fastech Integrated Solutions. Transcend’s Board decided to accept the Fastech offer. Fastech had a unique profile in the Communications and IT Industry and offered additional opportunities that other suitors did not possess. Newspring Capital, a Private Equity Firm that wanted to see an investment grow in the IP Telephony arena, backed Fastech for the acquisition.
Several months after the transaction, Transcend’s market-share experienced a dramatic increase on the East Coast the Company was recognized as ShorTel’s Vendor of Year.