Viavi Solutions has agreed to acquire Spirent Communications in an all-cash deal valuing Spirent at around $1.2 billion.
Under the terms of the acquisition, Spirent shareholders will receive 175 pence per share—comprising 172.5 pence in cash and a 2.5 pence special dividend. This represents a premium of 61.4 percent over Spirent’s closing share price of 108.4 pence on March 4th.
The acquisition will create a combined company that aims to be a global leader in test, measurement, and assurance solutions for communications networks and cybersecurity. Viavi stated the deal has a compelling strategic rationale, allowing it to offer more integrated solutions by combining its portfolio with Spirent’s complementary products and technologies.
Oleg Khaykin, President and CEO of Viavi, said: “Combining our leading communications test and measurement and optical technologies and Spirent’s high-performance testing and assurance solutions is expected to deliver enhanced product solutions, accelerate growth in new markets and strengthen innovation.
“Further, we are uniting two teams with a shared passion for developing compelling and cutting-edge offerings for customers and a commitment to technological excellence.”
In connection with the deal, private equity firm Silver Lake is making a $400 million strategic investment in Viavi to support the acquisition and Viavi’s growth plans.
Spirent’s board intends to unanimously recommend the cash offer to shareholders.
Sir Bill Thomas, Chairman of Spirent, commented: “Spirent is a business with a differentiated value proposition, diversified portfolio of technology solutions, deep customer relationships and talented people. Despite these strengths, we recognise that the Spirent Group has been operating against an increasingly challenging market backdrop.
“Having considered in great detail the interests of all Spirent shareholders and Spirent as a whole, the Spirent board believes that this all-cash offer recognises the underlying value of Spirent. That is why we intend to unanimously recommend this cash offer, which not only represents an attractive outcome for our investors, but also provides a significant opportunity for employees, customers and other stakeholders through what is a highly strategic and highly complementary combination.”
The transaction, which is subject to shareholder and regulatory approvals, is expected to close in the second half of 2024. Upon completion, Spirent will become a wholly-owned subsidiary of Viavi.
Eric Updyke, CEO of Spirent, said: “Combining with the Viavi Group brings together a highly complementary product offering which can be marketed globally. It will enable Spirent to build on the strategic progress we have made to date, with a partner that has the scale and resources to capitalise on the long-term growth opportunities ahead.”
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