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CommScope Holding stated that the Carlyle Group took 16% of the company's capital.
Photo:
Davis Turner / Bloomberg News
Updated Nov 8, 2018 at 9:08 am ET
Carlyle Group
reinvests in CommScope Holding Co. to help the network infrastructure company expand its wired and wireless communication networks.
CommScope announced Thursday it has agreed to buy Arris International PLC telecom equipment manufacturer in connection with a 100% cash transaction valued at approximately $ 4.93 billion. The company, which also agreed to repay Arris' debt, said Arris shareholders would receive $ 31.75 per share.
CommScope plans to fund the transaction in part through a $ 1 billion investment from Carlyle. The private equity firm bought CommScope in 2011, made it public in 2013 and sold the remaining shares in 2016.
This latest investment gives Carlyle a 16% stake in CommScope, the company said.
The remainder of the transaction will be financed by cash on hand and financing commitments from JP Morgan Securities LLC, Bank of America Merrill Lynch and Deutsche Bank Securities LLC.
The Arris agreement is expected to be finalized in the first half of next year. Upon completion, Eddie Edwards of CommScope will remain President and Chief Executive Officer and Bruce McClelland, CEO of Arris, will join the combined company.
The company resulting from the transaction is expected to generate a turnover of about $ 11.3 billion based on the financial results of the two companies for the 12-month period ended September 30th. Arris achieved a turnover of $ 6.7 billion during this period.
On Thursday, CommScope also released its results for the third quarter. The company reported a profit up 25% to $ 63.8 million and sales up 2% to $ 1.15 billion. On an adjusted basis, the company earned 59 cents per share. Analysts were expecting an adjusted earnings per share of 66 cents and a turnover of $ 1.22 billion.
CommScope shares fell 10% while Arris shares rose 11% in pre-market trading on Thursday.
Write to Kimberly Chin at [email protected]
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