SpiderCloud: A Small Cell Acquisition Target?

SpiderCloud might try for an IPO in 2016. And there may be potential for a buyout too.

Dan Jones, Mobile Editor

September 23, 2015

3 Min Read
SpiderCloud: A Small Cell Acquisition Target?

SpiderCloud, one of the last small cell startups standing, could make a tempting M&A target.

Here's a thing: There really aren't a lot of small cell startups left for larger vendors to buy, particularly not ones with a steady and growing revenue stream.

That's why it's interesting to look at SpiderCloud Wireless and consider its future. The enterprise small cell startup has been said to be considering an IPO in the future, but that isn't the only option for the company. (See Could Market Volatility Hurt Tech IPOs?)

From what I've heard, a sale could also be an alternative.

So let's look at some of the possible buyers:

The obvious choice
Cisco Systems Inc. (Nasdaq: CSCO) would seem to be the clear choice as a potential acquirer. SpiderCloud and Cisco have a fruitful partnership, which is helping to increase the startup's revenue while further cementing Cisco's reputation as a frontline player in the wireless enterprise market. (See Cisco to Resell SpiderCloud's Small Cells.)

But Cisco might be a bit wary of another small cell acquisition. The company didn't have a huge success in buying Ubiquisys in 2013 and didn't end up with the 3G and 4G small cell product line it had hoped for. (See Cisco Buying Ubiquisys for $310M and Cisco's Small Cell Boss Is Gone.)

Other possibilities
SpiderCloud also has a partnership with NEC Corp. (Tokyo: 6701) and has worked on a customer project with Nokia Networks . (See SpiderCloud Spins Web of Small Cell Partners .)

SpiderCloud has trash-talked Ericsson AB (Nasdaq: ERIC)'s Dot efforts in the past but could help provide the vendor with a ready-made enterprise small cell customer base. (See Ericsson's Radio Dot Receives Mixed Reception.)

For more on small cells, head to the small cells content channel here on Light Reading.

The wild card
An outside possibility in this M&A scenario is HP Inc. (NYSE: HPQ) The vendor bought enterprise WiFi provider Aruba Networks Inc. (Nasdaq: ARUN) in March for $3 billion in cash. SpiderCloud could be seen as a nice enterprise 3G and 4G complement to that buy, and HP clearly isn't shy about spending money to get what it wants. (See HP Sets Sail for Aruba.)

The price
Money is definitely going to be an issue when it comes to SpiderCloud. With growing revenues and an eye on an IPO, the company is unlikely to be cheap.

Larger players have been mostly scooping up femtocell survivors for small change recently. Airvana Inc. was bought by CommScope Inc. for a reported $50 million earlier this month. It had been bought by private investors in 2009 for $530 million. (See CommScope Adds Small Cells to DAS With Airvana Buy.)

The timeframe
There is, however, probably a limited window of time in which an acquisition could happen. SpiderCloud is apparently mulling an IPO in 2016 if it continues with its upward momentum.

Do you have any thoughts on potential buyers for SpiderCloud? Let us know on the message boards below.

— Dan Jones, Mobile Editor, Light Reading

About the Author(s)

Dan Jones

Mobile Editor

Dan is to hats what Will.I.Am is to ridiculous eyewear. Fedora, trilby, tam-o-shanter -- all have graced the Jones pate during his career as the go-to purveyor of mobile essentials.

But hey, Dan is so much more than 4G maps and state-of-the-art headgear. Before joining the Light Reading team in 2002 he was an award-winning cult hit on Broadway (with four 'Toni' awards, two 'Emma' gongs and a 'Brian' to his name) with his one-man show, "Dan Sings the Show Tunes."

His perfectly crafted blogs, falling under the "Jonestown" banner, have been compared to the works of Chekhov. But only by Dan.

He lives in Brooklyn with cats.

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