- Highly complementary and synergistic product portfolios to
enable delivery of high-performance, integrated solutions for
networking and mission-critical applications, including 5G and 6G
wireless infrastructure
- Complementary nature of products and technologies to provide
diversification and accelerated growth in attractive, adjacent
verticals, such as cloud service providers, enterprise/IT networks,
5G private networks, 6G+ and positioning, navigation and timing
verticals
- Greater engineering, research and development and design
capabilities to accelerate new technology development and product
innovation, in particular with regard to artificial intelligence
and machine learning, security, cloud-native architecture and
automation
- Operational efficiencies anticipated to result in annual
run-rate cost synergies of up to $75 million approximately two
years after the completion of the Acquisition
- Anticipate utilizing US net operating losses to lower the
combined group’s blended non-GAAP tax rate
- Silver Lake to make $400 million long-term strategic investment
in VIAVI Solutions in connection with the Acquisition
VIAVI Solutions (“VIAVI”) (NASDAQ: VIAV), a leading provider of
communications test, measurement and optical technologies, and
Spirent Communications plc (“Spirent”) (LSE: SPT), a global
provider of automated test and assurance solutions for networks,
cybersecurity and positioning, today announced an agreement on the
terms of a cash offer for Spirent which the Spirent Board intends
to unanimously recommend (the “Acquisition”). The Acquisition price
values Spirent at approximately £1,005 million, or $1,277 million
based on the British pound sterling to U.S. dollar exchange rate on
March 4, 2024.
Under the terms of the Acquisition, Spirent Shareholders will
receive 172.5 pence per Spirent share in cash (the Acquisition
price). Spirent Shareholders will also receive a special dividend
of 2.5 pence per Spirent share in lieu of a final dividend for the
year ended December 31, 2023. The Acquisition is expected to close
during the second half of 2024, subject to shareholder approvals
and other customary closing conditions, including Spirent
Shareholder approval and certain regulatory closing approvals. The
Spirent Directors who hold shares of Spirent have signed
irrevocable agreements in support of the Acquisition.
Spirent provides products, services and managed solutions that
address the test, assurance and automation challenges of
technologies, including 5G, software-defined wide area networks
(“SD-WAN”), cloud and autonomous vehicles. Spirent’s international
positioning, navigation and timing business also addresses the
needs of customers in research and development, verification and
integration testing, including the testing of hybrid positioning
and sensor fusion under real-world conditions. Spirent’s strategy
is built on three pillars—customer-centricity, innovation for
growth and operational excellence. Spirent is executing on this
strategy to further develop its offerings into live networks,
increasing its recurring revenue streams and providing value-added
services and solutions across the product portfolio.
“The Spirent Board intends to unanimously recommend this
all-cash offer, which not only represents an attractive outcome for
Spirent Shareholders, but also provides a significant opportunity
for employees, customers and other stakeholders through what is a
highly strategic and highly complementary combination,” said Sir
Bill Thomas, Chairman of Spirent. “With its strong management team,
global scale and the cultural alignment between our businesses, we
are confident that in VIAVI, we have found the right owner to take
Spirent on to the next phase of its growth story.”
“Combining with VIAVI brings together a highly complementary
product offering which can be marketed globally,” said Eric Updyke,
Chief Executive Officer of Spirent. “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 capitalize on the
long-term growth opportunities ahead. The combination of VIAVI and
Spirent creates a stronger business that will be better able to
compete, and we are confident in the opportunities this will bring
for our stakeholders.”
“VIAVI is proud to help enable its global customers to pursue
innovation across the wide range of industries it serves,” said
Oleg Khaykin, President and CEO of VIAVI. “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 and applications,
accelerate growth in new markets and strengthen innovation through
expanded engineering and design capabilities. 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. We are pleased to welcome a strategic,
long-term investment from Silver Lake in connection with the
Acquisition. Silver Lake has an outstanding track record of
supporting leading technology companies through both organic growth
investments and scale acquisitions.”
VIAVI believes, due to the complementary nature of the
respective businesses, there is a compelling strategic and
financial rationale for the Acquisition, as it is expected to:
Create a leading provider of test, assurance and security
solutions for research and development labs, service providers,
data centers and mission-critical infrastructure
- Merging the highly complementary product portfolios and
services will enable the combined group to deliver solutions for
various markets and applications.
Provide diversification and accelerated growth in attractive,
adjacent market verticals
- The combination of VIAVI and Spirent’s current and future
product offerings will position the combined group to bring to
market innovative solutions across high-growth cloud service
providers, enterprise/IT networks, 5G private networks, 6G+ and
positioning, navigation and timing verticals.
Achieve greater engineering, research and development and
design capabilities to accelerate new technology development and
product innovation
- VIAVI believes that building on the combined expertise of the
engineering, research and development and design teams of both
VIAVI and Spirent will result in greater engineering, research and
development and design capabilities to accelerate new technology
development and product innovation, in particular with regard to
artificial intelligence and machine learning, security,
cloud-native architecture and automation.
- Further, the combined group will benefit from additional
financial and operational resources to continue its leadership in
research and development and to deliver products to new verticals
to help customers solve their most difficult challenges.
Achieve greater operating leverage and generate cost
synergies
- Operational efficiencies anticipated to result in annual
run-rate cost synergies of up to $75 million approximately two
years after the completion of the Acquisition.
- VIAVI anticipates utilizing its US net operating losses to
lower the combined group’s blended non-GAAP tax rate.
- VIAVI will prioritize debt paydown utilizing free cash flow
generation after the completion of the Acquisition to lower
leverage ratios towards 4.0x gross and 3.0x net over the long
term.
The Acquisition will be funded by VIAVI’s existing cash, a fully
committed $800 million 7-year term loan from Wells Fargo Bank, N.A.
and a $400 million investment from Silver Lake in the form of a
fully committed senior convertible note. In connection with the
Silver Lake investment, Ken Hao, Chairman and a Managing Partner of
Silver Lake will join the VIAVI Board of Directors. In addition,
VIAVI obtained a $100 million 5-year revolving credit facility
(unfunded at close), committed by Wells Fargo Bank, N.A., to
provide additional financial flexibility.
More information (including the official offer announcement) and
further information about the Acquisition can be found at
https://investor.viavisolutions.com/overview/default.aspx.
Advisors
Qatalyst Partners is serving as lead financial advisor to VIAVI
and Bidco, and Wells Fargo Securities is serving as financial
advisor to VIAVI and Bidco. Fried, Frank, Harris, Shriver &
Jacobson LLP is serving as legal advisor to VIAVI and Bidco.
Rothschild & Co is serving as financial advisor and UBS and
Jefferies are serving as financial advisor and corporate broker to
Spirent. Linklaters LLP is serving as its legal advisor.
About VIAVI Solutions
VIAVI (NASDAQ: VIAV) is a global provider of network test,
monitoring and assurance solutions for telecommunications, cloud,
enterprises, first responders, military, aerospace and railway.
VIAVI is also a leader in light management technologies for 3D
sensing, anti-counterfeiting, consumer electronics, industrial,
automotive, government and aerospace applications. In 2023, we
celebrate over 100 years of Network Transformation and Optical
Innovation. Learn more about VIAVI at www.viavisolutions.com.
Follow us on VIAVI Perspectives, LinkedIn and YouTube.
About Spirent Communications
plc
Spirent Communications plc (LSE: SPT) is the leading global
provider of automated test and assurance solutions for networks,
cybersecurity and positioning. The Company provides innovative
products, services and managed solutions that address the test,
assurance and automation challenges of a new generation of
technologies, including 5G, SD-WAN, Cloud, autonomous vehicles and
beyond. From the lab to the real world, Spirent helps companies
deliver on their promise to their customers of a new generation of
connected devices and technologies. Further information about
Spirent Communications plc can be found at
https://corporate.spirent.com/.
Important Notices
Qatalyst Partners LP, which is authorized by the Securities and
Exchange Commission and regulated by the Financial Industry
Regulatory Authority and the Securities and Exchange Commission in
the US, is acting exclusively as financial advisor to VIAVI and
Bidco and will not be responsible to anyone other than VIAVI and
Bidco for providing the protections afforded to its client, or for
providing advice in relation to the matters set out in this press
release. No representation or warranty, express or implied, is made
by Qatalyst Partners LP as to the contents of this press
release.
Wells Fargo Securities, LLC, a subsidiary of Wells Fargo &
Company, which is authorized by the Securities and Exchange
Commission and regulated by the Financial Industry Regulatory
Authority and the Securities and Exchange Commission in the USA, is
acting exclusively as financial advisor to VIAVI and Bidco and will
not be responsible to anyone other than VIAVI and Bidco for
providing the protections afforded to its client, or for providing
advice in relation to the matters set out in this press
release.
N.M. Rothschild & Sons Limited (“Rothschild & Co”),
which is authorized and regulated by the Financial Conduct
Authority in the UK, is acting exclusively as financial advisor to
Spirent and no one else in connection with the Acquisition and will
not be responsible to anyone other than Spirent for providing the
protections afforded to clients of Rothschild & Co nor for
providing advice in connection with the Acquisition or any matter
referred to herein. Neither Rothschild & Co nor any of its
affiliates (nor their respective directors, officers, employees or
agents) owes or accepts any duty, liability or responsibility
whatsoever (whether direct or indirect, whether in contract, in
tort, under statute or otherwise) to any person who is not a client
of Rothschild & Co in connection with this press release, any
statement contained in this press release, the acquisition of
Spirent or otherwise. No representation or warranty, express or
implied, is made by Rothschild & Co as to the contents of this
press release.
UBS AG London Branch (“UBS”) is authorized and regulated by the
Financial Market Supervisory Authority in Switzerland. It is
authorized by the Prudential Regulation Authority and subject to
regulation by the Financial Conduct Authority and limited
regulation by the Prudential Regulation Authority in the UK. UBS is
acting exclusively as corporate broker and financial advisor to
Spirent and no one else in connection with the Acquisition. In
connection with such matters, UBS will not regard any other person
as its client, nor will it be responsible to any other person for
providing the protections afforded to its clients or for providing
advice in relation to the Acquisition, the contents of this press
release or any other matter referred to herein.
Jefferies International Limited (“Jefferies”) is authorized and
regulated in the UK by the Financial Conduct Authority. Jefferies
is acting exclusively as financial advisor and corporate broker to
Spirent and no one else in connection with the Acquisition and will
not be responsible to anyone other than Spirent for providing the
protections afforded to clients of Jefferies nor for providing
advice in connection with the Acquisition or any matter referred to
herein. Neither Jefferies nor any of its affiliates (nor their
respective directors, officers, employees or agents) owes or
accepts any duty, liability or responsibility whatsoever (whether
direct or indirect, whether in contract, in tort, under statute or
otherwise) to any person who is not a client of Jefferies in
connection with this press release, any statement contained in this
press release, the Acquisition or otherwise. No representation or
warranty, express or implied, is made by Jefferies as to the
contents of this press release.
This press release is for information purposes only and is not
intended to, and does not, constitute or form part of any offer to
sell, or an invitation to purchase, any securities or the
solicitation of an offer to buy any securities, or of any vote or
any approval in any jurisdiction, pursuant to the Acquisition or
otherwise.
This press release is not an advertisement and does not
constitute a prospectus or prospectus equivalent document.
Overseas Shareholders
Unless otherwise determined by Bidco or required by the Takeover
Code, and permitted by applicable law and regulation, the
Acquisition shall not be made available, directly or indirectly,
in, into, or from a Restricted Jurisdiction where to do so would
violate the laws in that jurisdiction and no person may vote in
favour of the Acquisition by any such use, means, instrumentality
or form within a Restricted Jurisdiction or any other jurisdiction
if to do so would constitute a violation of the laws of that
jurisdiction. Accordingly, copies of this press release and all
documents relating to the Acquisition are not being, and must not
be, directly or indirectly, mailed or otherwise forwarded,
distributed, or sent in, into, or from a Restricted Jurisdiction
where to do so would violate the laws in that jurisdiction, and
persons receiving this press release and all documents relating to
the Acquisition (including custodians, nominees, and trustees) must
not mail or otherwise distribute or send them in, into, or from
such jurisdictions where to do so would violate the laws in that
jurisdiction. To the fullest extent permitted by applicable law,
the companies and persons involved in the Acquisition disclaim any
responsibility or liability for the violation of such restrictions
by any person.
The Acquisition shall be subject to the applicable requirements
of English law, the Takeover Code, the Panel, the London Stock
Exchange, and the Financial Conduct Authority.
Additional Information for US
Investors
The Acquisition relates to shares of a UK company and is
proposed to be effected by means of a scheme of arrangement under
the laws of England and Wales. A transaction effected by means of a
scheme of arrangement is not subject to the tender offer rules or
the proxy solicitation rules under the US Exchange Act.
Accordingly, the Acquisition is subject to the disclosure and
procedural requirements applicable in the UK to schemes of
arrangement which differ from the disclosure requirements of US
tender offer and proxy solicitation rules.
Neither the US Securities and Exchange Commission nor any US
state securities commission has approved or disapproved or passed
judgment upon the fairness or the merits of the Acquisition or
determined if this press release is adequate, accurate or complete.
Any representation to the contrary is a criminal offence in the
US.
However, if Bidco were to elect to implement the Acquisition by
means of a takeover offer, such Takeover Offer would in addition
need to be made in compliance with any applicable US laws and
regulations, including any applicable exemptions under the US
Exchange Act. Such a takeover would be made in the US by Bidco and
no one else.
In the event that the Acquisition is implemented by way of a
takeover offer, in accordance with normal UK practice and pursuant
to Rule 14e-5(b) of the US Exchange Act, Bidco or its nominees, or
its brokers (acting as agents), may from time to time make certain
purchases of, or arrangements to purchase, shares or other
securities of Spirent outside the US, other than pursuant to such
takeover offer, during the period in which such takeover offer
would remain open for acceptance. These purchases may occur either
in the open market at prevailing prices or in private transactions
at negotiated prices. Any information about such purchases or
arrangements to purchase shall be disclosed as required in the UK,
shall be reported to a Regulatory Information Service and shall be
available on the London Stock Exchange website at
www.londonstockexchange.com.
In accordance with normal UK practice, VIAVI, Bidco, or their
nominees or brokers (acting as agents) may from time to time make
certain purchases of, or arrangements to purchase, shares or other
securities of Spirent, other than pursuant to the Acquisition,
until the date on which the Acquisition and/or scheme becomes
effective, lapses or is otherwise withdrawn. If such purchases or
arrangements to purchase were to be made, they would occur either
in the open market at prevailing prices or in private transactions
at negotiated prices. Any information about such purchases or
arrangements to purchase will be disclosed as required in the UK,
will be reported to a Regulatory Information Service and will be
available on the London Stock Exchange website at
www.londonstockexchange.com.
The receipt of consideration by a US shareholder or holder of
Spirent ADRs pursuant to the scheme will likely be a taxable
transaction for US federal income tax purposes. Each Spirent
Shareholder and Spirent ADR holder is urged to consult their
independent professional advisor immediately regarding the tax
consequences of the Acquisition applicable to them, including under
applicable US state and local, as well as overseas and other, tax
laws.
Financial information relating to Spirent included in this press
release and the scheme document (or, if applicable, the offer
document) has been or shall have been prepared in accordance with
accounting standards applicable in the UK and may not be comparable
to financial information of US companies or companies whose
financial statements are prepared in accordance with generally
accepted accounting principles in the US.
Bidco and Spirent are organized under the laws of England and
Wales. Some or all of the officers and directors of Bidco and
Spirent, respectively, are residents of countries other than the
US. In addition, most of the assets of Bidco and Spirent are
located outside the US. As a result, it may be difficult for US
shareholders of Spirent and Spirent ADR Holders to effect service
of process within the US upon Bidco or Spirent or their respective
officers or directors or to enforce against them a judgment of a US
court predicated upon the federal or state securities laws of the
US.
Forward-Looking
Statements
This press release (including information incorporated by
reference in this press release), oral statements made regarding
the Acquisition, and other information published by Spirent, any
member of the Spirent Group, VIAVI, Bidco, or any member of the
VIAVI Group, contain statements which are, or may be deemed to be,
“forward-looking statements”. Such forward-looking statements are
prospective in nature and are not based on historical facts, but
rather on current expectations and on numerous assumptions
regarding the business strategies and the environment in which
Spirent, any member of the Spirent Group, VIAVI, Bidco, any member
of the VIAVI Group, or any member of the combined group shall
operate in the future and are subject to risks and uncertainties
that could cause actual results to differ materially from those
expressed or implied by those statements.
The forward-looking statements contained in this press release
may relate to Spirent, any member of the Spirent Group, VIAVI,
Bidco, any member of the VIAVI Group, or any member of the combined
group’s future prospects, developments and business strategies, the
expected timing and scope of the Acquisition and other statements
other than historical facts. In some cases, these forward-looking
statements can be identified by the use of forward-looking
terminology, including the terms “believes”, “estimates”, “will
look to”, “would look to”, “plans”, “prepares”, “anticipates”,
“expects”, “is expected to”, “is subject to”, “budget”,
“scheduled”, “forecasts”, “synergy”, “strategy”, “goal”,
“cost-saving”, “projects” “intends”, “assumes”, “may”, “will”,
“shall” or “should” or their negatives or other variations or
comparable terminology. Forward-looking statements may include
statements relating to the following: (i) future capital
expenditures, expenses, revenues, earnings, synergies, economic
performance, indebtedness, financial condition, dividend policy,
losses and future prospects; (ii) business and management
strategies and the expansion and growth of Spirent, any member of
the Spirent Group, VIAVI, Bidco, any member of the VIAVI Group, or
any member of the combined group’s operations and potential
synergies resulting from the Acquisition; and (iii) the effects of
global economic conditions and governmental regulation on Spirent,
any member of the Spirent Group, VIAVI, Bidco, any member of the
VIAVI Group, or any member of the combined group’s business.
By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on
circumstances that shall occur in the future. These events and
circumstances include changes in the global, political, economic,
business, competitive, market and regulatory forces, future
exchange and interest rates, changes in tax rates and future
business combinations or disposals. If any one or more of these
risks or uncertainties materialize or if any one or more of the
assumptions prove incorrect, actual results may differ materially
from those expected, estimated or projected. Such forward-looking
statements should, therefore, be construed in light of such
factors.
None of Spirent, any member of the Spirent Group, VIAVI, Bidco,
nor any member of the VIAVI Group, nor any member of the combined
group, nor any of their respective associates or directors,
officers or advisors, provides any representation, assurance or
guarantee that the occurrence of the events expressed or implied in
any forward-looking statements in this press release shall actually
occur. Given these risks and uncertainties, potential investors
should not place any reliance on forward-looking statements.
Specifically, statements of estimated cost savings and synergies
relate to future actions and circumstances which, by their nature,
involve risks, uncertainties, and contingencies. As a result, the
cost savings and synergies referred to may not be achieved, may be
achieved later or sooner than estimated, or those achieved could be
materially different from those estimated. Due to the scale of the
combined group, there may be additional changes to the combined
group’s operations. As a result, and given the fact that the
changes relate to the future, the resulting cost synergies may be
materially greater or less than those estimated.
The forward-looking statements speak only at the date of this
press release. All subsequent oral or written forward-looking
statements attributable to Spirent, any member of the Spirent
Group, VIAVI, Bidco, or any member of the VIAVI Group, or any
member of the combined group, or any of their respective
associates, directors, officers, employees, or advisors, are
expressly qualified in their entirety by the cautionary statement
above.
Spirent, any member of the Spirent Group, VIAVI, Bidco, any
member of the VIAVI Group and any member of the combined group
expressly disclaim any obligation to update such statements other
than as required by law or by the rules of any competent regulatory
authority, whether as a result of new information, future events,
or otherwise.
No Profit Forecasts or
Estimates
No statement in this press release is intended as a profit
forecast or estimate for any period and no statement in this press
release should be interpreted to mean that earnings or earnings per
share for VIAVI or Spirent, as appropriate, for the current or
future financial years would necessarily match or exceed the
historical published earnings or earnings per share for VIAVI or
Spirent, as appropriate.
Disclosure Requirements of the Takeover
Code
Under Rule 8.3(a) of the Takeover Code, any person who is
interested in 1 per cent. or more of any class of relevant
securities of an offeree company or of any securities exchange
offeror (being any offeror other than an offeror in respect of
which it has been announced that its offer is, or is likely to be,
solely in cash) must make an Opening Position Disclosure following
the commencement of the offer period and, if later, following the
press release in which any securities exchange offeror is first
identified. An Opening Position Disclosure must contain details of
the person’s interests and short positions in, and rights to
subscribe for, any relevant securities of each of (i) the offeree
company and (ii) any securities exchange offeror(s). An Opening
Position Disclosure by a person to whom Rule 8.3(a) applies must be
made by no later than 3.30 p.m. (London time) on the 10th business
day following the commencement of the offer period and, if
appropriate, by no later than 3.30 p.m. (London time) on the 10th
business day following the press release in which any securities
exchange offeror is first identified. Relevant persons who deal in
the relevant securities of the offeree company or of a securities
exchange offeror prior to the deadline for making an Opening
Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or
becomes, interested in 1 per cent. or more of any class of relevant
securities of the offeree company or of any securities exchange
offeror must make a Dealing Disclosure if the person deals in any
relevant securities of the offeree company or of any securities
exchange offeror. A Dealing Disclosure must contain details of the
dealing concerned and of the person’s interests and short positions
in, and rights to subscribe for, any relevant securities of each of
(i) the offeree company and (ii) any securities exchange offeror,
save to the extent that these details have previously been
disclosed under Rule 8. A Dealing Disclosure by a person to whom
Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London
time) on the business day following the date of the relevant
dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, then they will be deemed to be a
single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made, can be found in the Disclosure Table on
the Panel’s website at http://www.thetakeoverpanel.org.uk/,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. If you are in any doubt as to whether you are required
to make an Opening Position Disclosure or a Dealing Disclosure,
then you should contact the Panel’s Market Surveillance Unit on +44
(0)20 7638 0129.
Rounding
Certain figures included in this press release have been
subjected to rounding adjustments. Accordingly, figures shown for
the same category presented in different tables may vary slightly
and figures shown as totals in certain tables may not be an
arithmetic aggregation of the figures that precede them.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240304034523/en/
VIAVI Solutions
Prosek Partners (Public Relations Advisor to VIAVI Solutions and
VIAVI Solutions Acquisitions Limited) Philip Walters, Prosek
Partners (UK) +44 (0) 7773331589
Andrew Merrill, Prosek Partners (US) +1 917 622 1252
pro-viavi@prosek.com
Spirent Communications
Dentons Global Advisors (Public Relations Advisor to Spirent
Communications) James Melville-Ross Humza Vanderman Leah Dudley
+44 2070387419 spirent@dentonsglobaladvisors.com
Viavi Solutions (NASDAQ:VIAV)
Historical Stock Chart
From Apr 2024 to May 2024
Viavi Solutions (NASDAQ:VIAV)
Historical Stock Chart
From May 2023 to May 2024