Consumer credit company swallows Neustar for $3.1bn

Consumer credit company swallows Neustar for $3.1bn

14 September 2021 | Alan Burkitt-Gray

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Neustar, once the company that ran the database of all of North America’s phone numbers, is being bought for US$3.1 billion in cash.

The buyer is TransUnion, a consumer credit reporting agency with a market capitalisation of over $23 billion.

Neustar, owned by two private equity investors, said it is expected to generate approximately $575 million of revenue and $115 million of adjusted EBITDA in 2021.

Chris Cartwright (pictured), president and CEO of TransUnion, said: “The credit information and analytics that TransUnion provides make trust possible between consumers and businesses.

“As digital commerce continues to grow globally, TransUnion’s powerful digital identity assets, enhanced by Neustar’s distinctive data and digital resolution capabilities, will enable safer and more personalized online experiences for consumers and businesses.”

Charlie Gottdiener, president and CEO of Neustar for the past three years, said: “The two companies’ complementary businesses, products and relationships will offer benefits for our combined customers, employees and other stakeholders across a diverse set of markets.”

Gottdiener added: “TransUnion and Neustar share a similar strategic vision, culture and focus on building innovative identity-based solutions which enable trusted connections between companies and people.”

Neustar is famous in the industry because for 17 years until it lost the contract in 2015 it ran the North American Numbering Plan. Every call to a North American number, from inside the area or from elsewhere in the world, first went through a Neustar database to identify the local operator so it could be routed.

That database also permitted North American operators to institute number portability for fixed and mobile services – even between fixed and mobile services – long before anyone else in the world. It also allowed cable operators and others to offer rival phone services to their customers, who did not need to change numbers.

But Neustar lost the contract to Telcordia, an Ericsson subsidiary that is now called Iconectiv.

Under then CEO Lisa Hook, in 2010 Neustar had ambitious plans to work with Hollywood studios to operate a movie and video streaming service.

Private equity investors Golden Gate Capital and GIC bought Neustar for an undisclosed sum in August 2018. Gottdiener subsequently replaced Hook as CEO.

Rishi Chandna, managing director at Golden Gate Capital, said: “We have great respect for TransUnion and are confident they are the right partner for Neustar in its next chapter.”