Inteliquent (NASDAQ:IQNT, news, filings) moved quickly to tie off a few loose ends as it shifts directions this fall. Following the announcement that the COO Surendra Saboo and CFO Robert Junkroski would leave on October 1, they have now named the successor CFO. David Zwick has been promoted from his current position as SVP of Business Development to EVP and Chief Financial Officer.
And as promised with their earnings release in August, Inteliquent came through with a special one-time cash dividend. The amount will be $3.00 per share, totalling $97M. That's less than the original intention to return $155-180 to shareholders, but that would have required accessing the credit markets. The updated plan will only use the company's cash on hand, a more conservative route that suggests that the financing wasn't available on sufficiently attractive terms. Inteliquent doesn't have long term debt on its balance sheet and generates cash, so they surely could have raised some if necessary - but it wasn't.
And finally, Inteliquent said that it is "engaged in ongoing negotiations with one of its largest customers that may result in a significant reduction in the rates that the customer pays to the Company and require the Company to pay to terminate certain traffic to that customer." In other words, the wholesale voice market not only wasn't much fun last quarter, it's probably not going to be much fun next quarter either. That much has been clear across the sector for a while.
All this continues to suggest to me that all options are open for Inteliquent at this point, as this looks like the most flexible stance they could have taken with the dividend. The voice business is hurting but still brings home the bacon as they shift toward more Ethernet and those new Hosted UC services. But the time may be ripe for some sort of M&A event to shift things to a faster track.
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