Qumu Corp., which was in danger of being delisted from Nasdaq, has been purchased.
Minneapolis-based software firm Qumu bought by Canadian company
With the $18 million purchase, Qumu is no longer traded on the Nasdaq exchange.
February 8, 2023 at 11:33PM
Enghouse Systems, a Canadian company, bought the software company for $18 million.
Qumu filed two documents with the U.S. Securities and Exchange Commission on Wednesday. One said the sale closed at midnight Monday. The second confirmed that Qumu would stop trading on Nasdaq because of the sale.
Based in Hamilton, Ontario, Enghouse Systems makes enterprise software for customers from contact centers and health care organizations to public safety and telecommunications companies. Qumu's software manages live stream video and video on demand.
"The combination of Qumu's video creation, management and delivery solutions with Enghouse's video collaboration and streaming products strengthens the position of both companies in a competitive space," Steve Sadler, chief executive of Enghouse said in a release announcing the deal.
Qumu has been a publicly traded company since 1992 when it was known as Rimage Corp. and its principle business was compact disc and CD-ROM replication systems.
As that industry faced a sharp decline, the company switched to enterprise video communication software applications. In 2011, it acquired a privately held company based in California named Qumu in an all-cash deal that was valued then at $52 million. In 2013, Rimage changed its name and ticker symbol to Qumu.
Rimage's revenue peaked in 2007 at more than $108 million, but it was clear that other storage media was displacing CD-ROMs, DVDs and similar formats. In 2014, Qumu sold its legacy disc replication assets to focus exclusively on enterprise-wide video software.
Annual revenue for the new strategy peaked in 2016 but has declined 30% since, and the company went through several top management changes.
Enterprise software to manage corporate videos had a pandemic surge as companies relied more on video conferencing technology and on-demand video for meetings, training and other purposes. In February 2021, Qumu shares peaked at more than $10 a share.
"Just as we embraced video as the future of work, this merger gives Qumu the opportunity to enhance our product innovation and the quality of our service and support," CEO Rose Bentley said in the news release announcing the deal. "We are excited about the transaction."
After deal to be acquired by Buffalo, N.Y.-based Synacor Inc. was terminated in June 2020, the company soon began looking at other strategic alternatives.
Qumu is officially based in Minneapolis, but in December 2020, then-CEO TJ Kennedy launched a 100% remote work environment for Qumu dubbed "Work from Wherever, Forever." As of Dec. 31, 2021, the company had 108 employees.
Last June, Qumu's shares fell to less than $1 per share, and in July Nasdaq issued the company a continued listing notice and gave it 180 days to revive the share price. The acquisition by Enghouse, which is traded on the Toronto Stock Exchange, makes the Nasdaq delisting moot.
Bremer has been rumored to be up for sale after a legal settlement in July.
