magicJack VocalTec cancels public sale of 1.5 million ordinary shares

Company also has best sales month ever, chief executive officer says

By Devika Patel

Knoxville, Tenn., Dec. 19 - magicJack VocalTec Ltd. said it has cancelled a planned public offering of 1.5 million ordinary shares due to pricing and dilution concerns. The deal was announced Dec. 9.

The company also said it sold more than 8 million magicJacks, with more than 365,000 magicJack PLUS devices sold in the last 30 days. The company is estimating fourth quarter 2011 sales to total $55 million to $60 million.

"It is quite exciting to watch our company ship the most magicJacks we have ever shipped in a 30-day period," chief executive officer and director Dan Borislow said in a press release. "It is now obvious the company is having its best sales quarter ever. Most of these sales will translate into revenue and income in future periods as we recognize the great majority of these sales as revenue over a 12-month, or longer, time frame.

"In addition, the company now expects to have the most cash and cash equivalents on its balance sheet in its history of over $50 million next month. With cash and equivalents growing so quickly, the company decided to halt the offering of its shares, determining that the dilution at current market prices was not worth any benefits it might receive from raising capital."

magicJack is a Herzliya, Israel, provider of carrier-class voice over internet protocol and convergence solutions for fixed and wireless communication service providers.

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