CommScope To Acquire Andrew In $2.6 Billion Deal
With news last week that CommScope Inc. had signed an agreement to acquire Andrew Corp. after having been rebuffed for a previous bid nearly a year ago, one element that reportedly has not changed is the intent to sell off Andrew’s satellite communications group.
In a deal estimated to be worth $2.6 billion, CommScope, of Hickory, N.C., will acquire all outstanding shares of Winchester, Ill.-based Andrew for $15 apiece. The price is a 53 percent increase over a $1.7 billion offer Andrew rejected in August, when Andrew also terminated an agreement to merge with ADC Telecommunications Inc.
In May, Andrew unveiled plans to sell its satellite communications business, which manufactures satellite antenna systems and electronics for home, commercial and military markets. The division accounted for 6 percent of the company’s revenues of $503 million in the 2007 second quarter. Meanwhile, overall revenues improved 4 percent from the same period a year ago, with Andrew posting a profit of $3.6 million in the 2006 second quarter.
Nevertheless, the consensus opinion is that the satellite communications component is not consistent with the other core enterprises.