CommScope agrees to Carlyle's $3.9-billion buyout offer
27 Oct 2010
Communications cable maker CommScope Inc today agreed to go private through a $3.9 billion buyout offer from private equity firm Carlyle Group.
Under the terms of the offer, Carlyle will acquire all of CommScope's outstanding common stock for $31.50 per share, in cash - a premium of 36 per cent over CommScope's closing stock price of $23.12 on the New York Stock Exchange on 22 October 2010.
Earlier reports had pegged the deal vallue at $2.98 billion based on 94.72 million shares outstanding on 21 July.
Under the merger agreement, CommScope has the option to solicit superior proposals for a period of 40 days until 5 December 2010. CommScope would have to pay a $43.3 million break-up fee to Carlyle if it intends to break the merger agreement.
Post closing, top executives of CommScope, including Frank Drendel, chairman and CEO and Eddie Edwards, president and COO, will continue to run the company.
"We are proud to enter into this agreement with Carlyle and believe this transaction is in the best interest of CommScope and our stockholders," said Drendel. "We are pleased that this transaction appropriately recognises the value of CommScope's customer relationships, technology and solutions, financial management and global market position, while providing our stockholders with a significant cash premium for their investment," he added.
"This transaction with Carlyle is a great outcome for CommScope's employees, customers and partners. As a private company, we believe CommScope will have greater flexibility to focus on our long-term strategic direction as a global leader in infrastructure solutions for communications networks," said Edwards.