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October 27, 2010, 9:45 AM EDT
By Amy Thomson
(Updates with today?s trading in fifth paragraph.)
Oct. 27 (Bloomberg) -- CommScope Inc., the maker of telecommunications equipment, is going private in a $3.9 billion acquisition by the leveraged-buyout firm Carlyle Group.
The purchase values CommScope at $31.50 per share in cash, the companies said in a statement. That?s about 36 percent more than the closing price on Oct. 22, the last trading day before CommScope said it was in talks to be acquired by Washington- based Carlyle.
CommScope is working to revive sales after the global recession hurt demand last year. Carlyle is banking on an increase in demand for fiber-optic networks as phone- and Internet-service providers update their systems to accommodate increasing amounts of video and data.
CommScope, which sells its products worldwide, said revenue this quarter will be $730 million to $780 million, missing the $805.9 million predicted by analysts in a Bloomberg survey. The company has raised prices as its costs have increased, cutting into sales, Chief Financial Officer Jearld Leonhardt said in a separate statement. Sales a year earlier were $748.5 million.
Shares of CommScope rose $1.05 to $31.27 in New York Stock Exchange composite trading at 9:41 a.m. The Hickory, North Carolina-based companny?s stock had gained 14 percent this year before today.
Members of the senior management team, including Chief Executive Officer Frank Drendel and Chief Operating Officer Eddie Edwards, will stay at the company, according to the statement.
The companies said they expect to close the acquisition in the first quarter of 2011. Under the merger agreement, CommScope can shop for better offers through Dec. 5. If CommScope takes another offer, it must pay a $43.3 million termination fee.
Allen & Co. was the financial adviser for CommScope and JPMorgan Chase & Co. advised Carlyle.
--Editors: Ville Heiskanen, Peter Elstrom
To contact the reporter on this story: Amy Thomson in New York at athomson6@bloomberg.net
To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net
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(Updates with today?s trading in fifth paragraph.)
Oct. 27 (Bloomberg) -- CommScope Inc., the maker of telecommunications equipment, is going private in a $3.9 billion acquisition by the leveraged-buyout firm Carlyle Group.
The purchase values CommScope at $31.50 per share in cash, the companies said in a statement. That?s about 36 percent more than the closing price on Oct. 22, the last trading day before CommScope said it was in talks to be acquired by Washington- based Carlyle.
CommScope is working to revive sales after the global recession hurt demand last year. Carlyle is banking on an increase in demand for fiber-optic networks as phone- and Internet-service providers update their systems to accommodate increasing amounts of video and data.
CommScope, which sells its products worldwide, said revenue this quarter will be $730 million to $780 million, missing the $805.9 million predicted by analysts in a Bloomberg survey. The company has raised prices as its costs have increased, cutting into sales, Chief Financial Officer Jearld Leonhardt said in a separate statement. Sales a year earlier were $748.5 million.
Shares of CommScope rose $1.05 to $31.27 in New York Stock Exchange composite trading at 9:41 a.m. The Hickory, North Carolina-based companny?s stock had gained 14 percent this year before today.
Members of the senior management team, including Chief Executive Officer Frank Drendel and Chief Operating Officer Eddie Edwards, will stay at the company, according to the statement.
The companies said they expect to close the acquisition in the first quarter of 2011. Under the merger agreement, CommScope can shop for better offers through Dec. 5. If CommScope takes another offer, it must pay a $43.3 million termination fee.
Allen & Co. was the financial adviser for CommScope and JPMorgan Chase & Co. advised Carlyle.
--Editors: Ville Heiskanen, Peter Elstrom
To contact the reporter on this story: Amy Thomson in New York at athomson6@bloomberg.net
To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net
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