May 13, 2010 (FinancialWire) — Veraz Networks (NASDAQ: VRAZ), a provider of bandwidth optimization and switching products, and privately held Dialogic Corp., a an interactive mobile video services and applications firm, said that they have entered into a definitive agreement to merge.

After closing, the name of the merged company will be Dialogic, and it will offer communications products and services to the telecommunications service provider and enterprise markets.

The merged company is expected to be led by Nick Jensen as chairman and CEO. He is the current chairman and CEO of Dialogic, Doug Sabella is expected to serve as president and COO of the merged firm. He is currently serving as Veraz’s president and CEO.

Following the merger and subsequent integration of the two companies, on an annualized basis (after excluding adjustments to revenue and expenses under purchase accounting rules, transaction related costs and one-time charges), the merged company revenues are expected to be greater than $250 million with gross margins of 60-65% and EBITDA of 10-15% of revenues, according to the companies.

Under the terms of the agreement, unanimously approved by each company’s board, Veraz will issue shares of its common stock to each Dialogic shareholder so that following the closing of the transaction, Dialogic shareholders will own around 70% and Veraz shareholders will own around 30% of the merged company.

California-based Veraz is currently traded on NASDAQ and both companies said they expect that the merged company will continue to be traded on NASDAQ.

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