BOULDER, Colo. and HORSENS, Denmark -- SpectraLink Corp. (Nasdaq: SLNK), the North American leader in workplace wireless telephony, today announced it has entered into a definitive agreement to acquire KIRK telecom (KIRK), a leading global provider of on-site, wireless communications products, based in Denmark.
Under the terms of the agreement, SpectraLink will pay a total of DKr 388 million (approximately $61.3 million) in cash to purchase all the stock of KIRK from its stockholders. The transaction is subject to the completion of a number of conditions. Avondale Partners, LLC served as exclusive financial advisor to SpectraLink in connection with the transaction. The acquisition will significantly increase SpectraLink's international reach by augmenting its distribution channels and geographical market penetration, further extending its leadership in workplace wireless telephony. The combination of the two companies expands SpectraLink's product portfolio to include a complete product portfolio that incorporates all major enterprise wireless voice technologies (Wi-Fi, DECT and proprietary systems).
Under the transaction, which is expected to close Jan. 3, 2006, KIRK will become a SpectraLink company while continuing to do business under the KIRK name. SpectraLink obtained combined debt financing of $40 million in the form of a three-year term loan and revolving credit line. Those loans are secured by SpectraLink's assets. The company will use a combination of debt and up to $30 million of its own cash to acquire all of the outstanding shares of KIRK. Management believes that this acquisition will be accretive to earnings in its first year.
In its last fiscal year ended April, 30, 2005, KIRK had revenues of $35.9 million and net income of $2.7 million. KIRK scantel, a division that offers consumer-grade telephones in Scandinavia, will remain a wholly-owned subsidiary.
"With this acquisition, SpectraLink will have an unrivaled breadth and depth of expertise and products for workplace wireless telephony," said John Elms, president and CEO of SpectraLink. "Adding DECT technology expands our market potential in the U.S. and also provides additional reach overseas for our Wi-Fi products. The combined companies create a truly global organization with significant distribution in more than 40 countries."
SpectraLink Corp.