Aviat Networks, Inc. Acquires NEC's Wireless Transport Business
May 09, 2023 at 02:06 am EDT
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Aviat Networks, Inc. announced that they have entered into a definitive agreement with NEC Corporation for the sale of its Wireless Transport Business to Aviat in an asset purchase transaction valued at $70.0 million U.S. dollars in cash and shares. This acquisition will bring three immediate and significant benefits for Aviat, combined customers and shareholders: Improvement to scale. Aviat anticipates an additional $150 million in revenue which will be accretive to adjusted EBITDA, non-GAAP EPS, and free cash flow by the end of the first year and anticipate getting the acquired business to 11-13% EBITDA by the end of year two.
Complimentary businesses and learnings from the 2019 channel partnership with NEC in North America will result in cost synergies that will pay for the acquisition. With little overlap in product offering and very few common accounts, the company expects sales synergy opportunities in both Aviat and NEC customers, which represent upside not factored into financial model; Enhanced product portfolio with greater capability to innovate. The combined product and Intellectual Property (IP) portfolios will boost innovation and create a broader technology set to significantly increase the reach of Aviat's global business.
Aviat will have additional scale to extend its leadership in innovation by utilizing the product roadmap and next-generation initiatives from the two companies; and A more diversified business. The combined business would service over 20 Tier 1 service providers worldwide and be a leader in private networks. With over 3 million PASOLINK unit shipments worldwide, Aviat's business will have increased exposure to global 5G spend and private network opportunities that will further diversify Aviat's business into fast-growing international markets with significant growth opportunities.
Aviat Networks, Inc., together with its subsidiaries, is a supplier of microwave networking and wireless access networking solutions. It designs, manufactures, and sells a range of wireless networking products, solutions, and services. It also offers routers and a range of premise and hosted private cloud-based software tools and applications to enable deployment, monitoring, network management, and operational assurance of its systems as well as to automate network design and procurement. It also sources, qualifies, supplies, integrates, tests, and supports third party equipment such as antennas, optical transmission equipment and other equipment necessary to build and deploy a complete telecommunications transmission network. It provides a full suite of professional services for planning, deployment, operations, and maintenance of its customersâ networks. It offers a suite of wireless transport and access systems for microwave and millimeter wave networking applications.
AVIAT NETWORKS, INC. 
