CommScope has completed the acquisition of the Connectivity Solutions business of Avaya, except for certain international operations that are expected to be completed later this year.
The transaction creates a combination of connectivity solutions for enterprise applications and cable for Hybrid Fiber Coaxial applications. The acquisition also expands CommScope’s leadership position in the “last mile” of telecommunications, the company says.
“We are thrilled to begin a new chapter in the history of industry leaders and telecom pioneers,” said Frank Drendel, chairman and CEO of CommScope. “We believe this combination creates significant opportunities for synergy and innovation and will provide value to our customers and business partners.
The financing includes $250 million in cash, subject to post-closing adjustment, and about 1.8 million shares of CommScope common stock. The shares are valued at $32.8 million. CommScope will also assume up to $65 million of liabilities, primarily related to employee benefits.
The cash portion of the purchase price consists of $150 million from CommScope’s existing cash balances and $100 million from borrowing under a new 5-year $185 million senior secured credit facility. The new credit facility, which replaces CommScope’s previous credit facility, is comprised of a $75 million term loan and a $110 million revolving credit facility, and was underwritten and arranged by Wachovia Securities.
Hickory-based CommScope had approximately $206 million in cash and cash equivalents on its balance sheet as of Dec. 31, 2003.
CommScope: www.commscope.com
