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Proxim Sells Assets for $21M

Struggling wireless kit vendor Proxim Corp. (Nasdaq: PROX) announced over the weekend that it is to be acquired by Moseley Associates Inc. for $21 million and will file for Chapter 11 bankruptcy protection.

The deal ends months of speculation surrounding the fate of Proxim. In April Unstrung laid out the extent of the company’s problems and last month touted a potential buyout by Moseley (see Proxim Has a Debt Dilemma , Proxim on the Ropes, and Proxim Faces D-Day).

“Moseley will acquire and assume most of the domestic and foreign operations of Proxim for a purchase price of $21 million, subject to certain adjustments and deductions,” notes a joint statement (see Moseley Acquires Proxim). “The sale will be implemented through Proxim’s filing of a Chapter 11 bankruptcy case in the United States Bankruptcy Court for the District of Delaware and subject to court confirmation and overbidding procedures.

“In connection with the sale, Moseley also has agreed to provide Proxim with bridge financing in the principal amount of up to $6.2 million, to be offset against the purchase price. Under the terms of the transaction as contemplated, no proceeds of the sale are expected to be distributed to Proxim stockholders.”

Formerly a top-three player in enterprise wireless LAN equipment sales, Proxim has struggled to keep pace with rivals Cisco Systems Inc. (Nasdaq: CSCO) and Symbol Technologies Inc. (NYSE: SBL) in this fast-moving market over the last couple of years. For the first quarter ended April 1, Proxim posted a net loss of $7.8 million, or $0.24 per share, on revenues of $25.4 million, compared to a net loss of $17.5 million, or $0.42 per share, on revenues of $26.7 million in the same period a year ago (see Proxim Reports $7.8M Q1 Loss).

Moseley is expected to continue developing Proxim’s wireless LAN, broadband wireless, and WiMax products. “We intend to fully support all of Proxim’s existing customers and product warranties,” comments Jamal Hamdani, president and CEO of Moseley, in a statement. “Our plan includes providing an invigorating and exciting work environment for Proxim’s employees as well.”

Neither company was available for comment at press time.

The firm’s shares, which were worth over $250 at their high point in 2000, languished at $0.32 at the close of trading on Friday.

— Justin Springham, Senior Editor, Europe, Unstrung

whatupwireless 12/5/2012 | 3:10:51 AM
re: Proxim Sells Assets for $21M How is Proxim number 18 on the Unstrung 25 (list of top 25 public companies)? One notch above Qualcomm?
mobileIP 12/5/2012 | 3:10:41 AM
re: Proxim Sells Assets for $21M ..."How is Proxim number 18 on the Unstrung 25 (list of top 25 public companies)? One notch above Qualcomm?"

I think its called the alphabet ;-)

More seriously though, how can a company get it SOOO wrong just at a time when wireless networking is turning into a $bn business. The mind boggles
freetoair 12/5/2012 | 3:10:23 AM
re: Proxim Sells Assets for $21M 1) they purchased advertising?
2) they said the golden word "WiMAX" and were working with Intel?
3) there were too few companies to complete a full list, so by defualt...?
4) the list was created Friday 11:00pm in a couple of minutes with 6-7 pints under the belt?

BTW they were off the rails for years.
- blew early WLAN lead
- merged with Western Multiplex and killed or let die that albeit small business
- had the US Robotics mgmt team, who were just not the right fit for the times, in there for too long
- in general had a 'D' team across the board
- did nothing, slow to move on .11 standards based products, let the WLAN switch bit go by, etc.

not sure how you define this
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