On last Thursday, CommScope announced to purchase Arris in deal of worth $7.4 billion with per share offer price of $31.75. CommScope, a U.S. maker of telecom equipments, has decided to acquire the set-top box maker Arris to boost up its business and in surge of capturing market from upcoming 5G worldwide crush. After debt payments the deal will be valued at $5.60 billion.
CommScope is a provider of connectivity products to cable service operators and wireless industry acquired b y Carlyle Group, a private equity firm in 2013. Whereas Arris is also related to these same industries providing set-top boxes and modems. And now for a stake of nearly 16 percent, Carlyle will be making an equity investment of $1 billion in CommScope.
The deal come amidst telecommunication companies have been equipping for 5G. Aiming to infrastructure up gradation and setting themselves up for 5G networks, these companies are spending a lot. CommScope and Arris will be mutually benefitted from the deal. Arris will get a safe exit from situation of declining number of peoples using set- top box to watch TV and CommScope will be enjoying with diversified products. CommScope’s headquarter at Hickory having over 230 staff, will be the headquarter for combined companies along with maintaining a significant presence in Suwanee, Georgia also, for being headquarter of Arris.
For years, with its market capitalization of $4.689 billion, CommScope has been investing to services and infrastructure sectors. It also provided technical support and equipments for wireless network of Bank of America Stadium while working with Caroline Panthers.
Arris remained involved in cable or wire line broadband along with continuous efforts to align itself with challenges of transition of cable industry going wireless. Last year acquisition of Ruckus Networks for $800 million by Arris was one of the steps towards that transition strategy. Now Arris has market capitalization worth of $5 billion.