CommScope completes acquisition of TE Connectivity’s telecom, enterprise and wireless businesses

CommScope Holding Company has completed its previously announced acquisition of TE Connectivity’s Telecom, Enterprise and Wireless businesses. 
 
The all cash transaction, valued at approximately $3bn, strengthens CommScope’s position as an infrastructure provider with deeper resources to meet the world’s growing demand for network bandwidth. 
 
“We are excited to move forward as one company positioned for continued success,” said Eddie Edwards, CommScope president and chief executive officer. “Together, we look to accelerate industry innovation, solve more wired and wireless network challenges, and better serve customers in more markets around the world. By uniting our complementary solutions, technologies and geographic and market coverage, we have created a stronger platform for competing successfully around the world.
 
“With this acquisition, we will have significant new opportunities for future sales growth and cost efficiencies to strengthen CommScope’s financial foundation. The addition of the TE businesses is expected to immediately contribute to our profitable growth.”
 
CommScope expects to realise more than $150m in annual synergies in 2018, which includes more than $50m in 2016. CommScope expect to drive synergies across all areas of the company, including sales, marketing, general and administration, operations, and research and development. The transaction is expected to be in excess of 20% accretive in 2016 on a pro-forma basis, excluding purchase accounting charges, integration costs and other special items.
 
The new CommScope has approximately 25,000 employees, with a more significant presence in all major geographic regions. Pro-forma net sales (for the 12 month period ended 30th June 2015) were approximately $5.3bn and pro-forma adjusted EBITDA (excluding anticipated synergies) was approximately $1bn. The company now holds a portfolio of approximately 9,800 patents and patent applications, with research and development investment of more than $200 million a year.
 
For the near term, the newly acquired TE Connectivity Broadband Network Solutions (BNS) businesses will be operated as one of CommScope’s business segments, alongside of the existing CommScope segments of Wireless, Enterprise and Broadband. David Redfern will continue in his current role as leader of the BNS team, reporting to CommScope’s chief operating officer Randy Crenshaw.
 
“I welcome our new team members from TE Connectivity and look forward to continuing to work closely with all employees at CommScope to ensure we continue to deliver superior technology, solutions and services to our customers and partners,” Edwards said.
 
The closing of the transaction follows the consummation of contemplated financing, regulatory approvals and other customary closing conditions.

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