The all-cash transaction translates to roughly $31.75 per share, which includes the repayment of debt and the newly combined company is predicted to make roughly $11.3 billion in revenues, with adjusted EBITA set for $1.8 billion.
Once the deal is completed, the newly combined company is expected to generate profitable growth in new markets and lead the way in wired and wireless communications. As well as position the company to benefit from industry trends like network convergence, fibre, mobility, 5G, internet of things and the ever changing network and technology architectures.
“After a comprehensive evaluation of our business and the evolving industry we operate in, we are confident that combining with ARRIS is the best path forward for CommScope to grow and provide the greatest returns for shareholders,” said Eddie Edwards, president and chief executive officer, CommScope. “CommScope and ARRIS will bring together a unique set of complementary assets and capabilities that enable end-to-end wired and wireless communications infrastructure solutions that neither company could otherwise achieve on its own. With ARRIS, we will access new and growing markets, and have greater technology, solutions and employee talent that will provide additional value and benefit to our customers and partners.
A number of benefits for shareholders have been identified through this deal that include@ being well positioned to capitalise on industry trends; it will unlock high-growth segments and increase product addressable market; increases product offerings and R&D capabilities; and strengthens the financial profile of the new entity.
“CommScope is an ideal partner for ARRIS. In addition to providing immediate and substantial cash value to our shareholders, we are excited for what this combination will deliver for our customers, partners and employees around the world, said ARRIS chief executive officer, Bruce McClelland (pictured). “Today’s agreement is a testament to the strength of ARRIS: our leading technology, talented employees and established competitive position. With CommScope, we expect to further advance ARRIS’ strategy to drive innovation across our iconic brands and pioneer the standards and pathways for tomorrow’s personalised, connected always-on consumer experience. ARRIS will become part of an even stronger, more global industry leader, and I look forward to working with the CommScope team to achieve great results for the combined company.”
In addition to the ARRIS acquisition, the Carlyle Group, a global asset manager, has re-established its ownership position in CommScope though a $1 billion minority equity investment as part of CommScope’s financing of the ARRIS deal.
