California-based Language Line Services (LLS) announced the acquisition of long-time competitor and Oregon-based telephone interpreting company Pacific Interpreters. This announcement, which results in a telephone interpreting company with a reported US$300 million in revenue, really comes as no surprise. It was only a matter of time until LLS, sitting on hefty cash reserves and looking for a way to profitably increase revenue, made just the right offer for one of the telephone interpreting companies sitting in the revenue range it considers attractive. What are the implications of LLS’s latest acquisition?

• For the industry. Klein believes that the acquisition will benefit the greater telephone interpreting industry. He reasons, “It will afford us the opportunity to make investments that are long overdue in technology and solutions that customers really need.” Will those investments reduce connection times and improve the customer experience?  The telephone interpreting market is a small one, and LLS is the company that carried out all the original market development to build it. Since then, no company in the industry has done anything that we would consider revolutionary in terms of offering innovative services or technology.  We agree that investment – and innovation – are sorely lacking in this space to make things better for customers. Pacific Interpreters built a strong reputation for client service, so perhaps some of its infrastructure in this area will benefit LLS.

And Language Line Services? Obviously, LLS benefits the most. LLS has a history of waiting until its competitors “fatten up” and get to a size where they become a nice acquisition target, as we’ve noted since 2008 (see “It’s Getting Lonelier at the Top of the TI Market,” Jul08). LLS has been interested in acquiring companies for several years now, but the conditions recently changed, with both Language Line Services and Pacific taking on new CEOs and other key management. More.

See: Common Sense Advisory

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