CommScope is on the verge of going private after agreeing to be bought out by The Carlyle Group in a deal valued at $3.9B

Michelle Donegan

October 27, 2010

1 Min Read
Carlyle Snaps Up CommScope for $3.9B

As expected, CommScope Inc. has agreed to a takeover by The Carlyle Group LLC in a $3.9 billion that will result in the broadband and wireless equipment maker becoming a private company.

CommScope on Monday said it was talking to the private equity investment firm. The announcement sent its share price soaring as much as 30 percent Monday morning. (See CommScope, Carlyle Strike $3.9B Merger , CommScope Rockets on Takeover Talks , and CommScope in Buyout Talks.)

Under the terms of the deal, Carlyle will acquire all the outstanding shares of CommScope's common stock for $31.50 per share in cash, which is a premium of about 36 percent over CommScope's closing share price on Friday, Oct. 22.

It is expected that CommScope chairman and CEO Frank Drendel and president and COO Eddie Edwards, as well as other members of the executive management team, will continue with the company when the deal is finalized. The transaction is expected to close in the first quarter of 2011.

CommScope, in addition to announcing that it had agreed to be taken private, also posted third-quarter results today. The company reported revenues of $822.9 million for the third quarter, up 9.5 percent compared with the same period last year, but down 1.9 percent compared to the second quarter. Net income in the third quarter was $50.6 million, or $0.49 earnings per diluted share.

Drendel noted that North American wireless spending remained strong in the period, with CommScope's Enterprise segment performing well across all major product groups and geographies. CommScope, he added, is also seeing "modest sequential improvement" in India's wireless infrastructure market.

CommScope shares were up 3.67 percent ($1.11) to $31.33 each in early trading Wednesday. — Michelle Donegan, European Editor, Light Reading Mobile

About the Author(s)

Michelle Donegan

Michelle Donegan is an independent technology writer who has covered the communications industry for the last 20 years on both sides of the Pond. Her career began in Chicago in 1993 when Telephony magazine launched an international title, aptly named Global Telephony. Since then, she has upped sticks (as they say) to the UK and has written for various publications including Communications Week International, Total Telecom and, most recently, Light Reading.  

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