Arris Group to buy UK-based set-top box maker Pace for $2.1 bn
23 Apr 2015
US telecommunications equipment manufacturer Arris Group Inc yesterday struck a deal to buy British set-top box maker Pace Plc in a $2.1-billion cash-and-stock deal in order to expand its international presence.
Under the agreed terms, Pace shareholders will receive £1.325 of cash and a fixed exchange ratio of 0.1455 New Arris shares for each Pace share worth £4.265 per share as of 21 April, a 28-per cent premium to the Pace closing share price on 21 April.
On a pro forma basis, current Arris shareholders will hold about 76 per cent shares in the combined company, while Pace shareholders will hold the remaining.
The cash portion will be funded through a combination of cash and debt. Arris said that it has secured a fully committed facility from Bank of America Merrill Lynch to fund the deal.
The transaction will result in the formation of New Arris, which will be incorporated in the UK, but have its operational and global headquarters in Suwanee, Georgia, and be listed on the Nasdaq Stock Exchange.
Pace develops set-top boxes, advanced residential gateways, software and services for the pay-TV and broadband services industry. Pace's over 200 customers include cable, telco, satellite and IPTV operators.
Based in West Yorkshire, Pace employs around 2,300 people in the UK, US, France, India, and China.
"Pace plc is a great company with a strong track record of pioneering innovation and excellent customer service. Through a combination of organic development and acquisitions, Pace has grown to be a leading technology solutions provider to the PayTV and Broadband industries serving cable, satellite and telco customers across the globe,'' said Allan Leighton, chairman of Pace.
Arris is a telecommunications equipment manufacturing company that provides cable operators with high-speed data, video and telephony systems for homes and businesses.
Its customers include Time Warner Cable, Comcast Corp, and AT&T, while its competitors include TiVo Inc and Cisco Systems.
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