| In the News |
 |
| Press Releases |
 |
| Events |
 |
| |
|
|
ADC Completes Acquisition of LGC Wireless
Combined
Company Creates Extensive, Market Leading Portfolio of Wireless
Capacity and Coverage Solutions
MINNEAPOLIS
– December 3, 2007
– ADC (NASDAQ:ADCT,
www.adc.com) today announced that it completed its acquisition
of LGC Wireless (www.lgcwireless.com),
a market leader in specialized wireless coverage and capacity
solutions for carriers and the enterprise.
With this
acquisition, ADC is combining its
advanced outdoor wireless solutions, global scale, worldwide
customer base, and innovations in connectivity with LGC’s
advancements and market leadership in the
in-building wireless solutions market. This combination creates
a leading platform for serving carriers' capacity and coverage
needs. The acquisition further diversifies ADC’s revenue base by
more than doubling the company’s wireless business to over 9% of
total sales and is expected to help increase the company’s overall
growth rate.
“We are excited
to finalize the strategic acquisition of LGC Wireless as it bolsters
our momentum in capturing share in the fast growing wireless
capacity and coverage market. LGC’s innovative in-building solutions
add scale to our existing line of outdoor wireless products and
supports ADC's long-term goal of being the leading global provider
of network infrastructure solutions," said Robert E. Switz,
president and CEO of ADC. “The value created in combining the
strengths of both companies will advance ADC’s ability to deliver on
our vision of the next-generation radio access network and better
meet the wireless network demands of our customers worldwide.”
Summary of Transaction
ADC has acquired LGC for $169 million. This includes a purchase
price for the outstanding equity interests of LGC for approximately
$148.5 million. Under the transaction ADC paid cash for all the
shares of LGC outstanding. Optionholders of LGC shares were given
the opportunity to either receive a cash payment for their options
or an exchange of the options for options to acquire ADC shares. ADC
also has assumed certain transaction expenses, agreed to assure
payment of LGC employee bonuses and assumed LGC's current debt, in
aggregate approximately $20.5 million.
A market leader
in the United States, Middle East and Latin America, LGC had sales
of $83 million in the last 12 months ended September 30, 2007
compared to sales of $43 million in the year ended December 31,
2006. The company has approximately 240 employees and operates
facilities in San Jose and Mountain View, Calif.
ADC expects to
take a charge for various acquisition-related expenses, the amount
of which has not been determined. Excluding this charge and future
amortization of acquired intangibles and stock option expense, ADC
expects the acquisition to be non-dilutive to earnings per share
from continuing operations in fiscal 2008 and around $0.02-0.04
accretive in fiscal 2009.
Delivering
Innovative IP RAN Wireless Solutions
The combination of ADC and LGC
accelerates the execution of ADC's All IP Radio Access Network (RAN)
and creates a comprehensive portfolio of market leading solutions
for carriers and the enterprise.
ADC's complete
line of turn-key broadband and carrier wireless solutions are
transforming the wireless network edge, providing coverage and
capacity solutions where needed to serve existing 2G, 3G and
emerging 4G networks. From ADC’s flexible and scalable outdoor radio
head platform, FlexWave Universal Radio Head (URH), to extended
fiber reach via FlexWave Millimeter Wave (MMW), to indoor and campus
coverage and capacity with FlexWave Base Station System (BSS)
solutions, to high-speed wireless backhaul with FlexWave WMX WiMAX,
carriers consistently look to ADC for reliable solutions. ADC's
wireless solutions portfolio also includes the Digivance line of
distributed antenna system (DAS) products and the ClearGain
Tower-Mounted Amplifier (TMA) and Ground-Mounted Amplifier (GMA)
products.
With more than
10,000 systems shipped worldwide to more than 100 countries, LGC
Wireless' scalable, high-performance indoor solutions are at work
inside buildings in all categories of major venues and industries.
In addition, as a leading supplier of compact GSM and CDMA wireless
networks, LGC Wireless also provides specialized solutions to mobile
operators for a broad range of applications. LGC Wireless' products
offer low-cost installation, end-to-end monitoring and management,
and easy integration of emerging wireless technologies.
About ADC
ADC provides the connections for wireline, wireless, cable,
broadcast, and enterprise networks around the world. ADC's
innovative network infrastructure equipment and professional
services enable high-speed Internet, data, video, and voice services
to residential, business and mobile subscribers. ADC (NASDAQ: ADCT)
has sales into more than 130 countries. Learn more about ADC at
www.adc.com.
Cautionary
Statement Regarding Forward Looking Information
All
forward-looking statements contained herein, particularly those
pertaining to ADC's expectations for the performance of the
acquisition as well as future operating results, reflect
management's current expectations or beliefs as of the date of such
statements and are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. ADC cautions
that any forward-looking statements made by us about the acquisition
are qualified by important factors that could cause actual results
to differ materially from those in the forward-looking-statements.
These factors include, without limitation: differences between the
expected and the actual future performance of the business being
acquired; marketplace conditions and market growth rates for the
acquired business and our business generally; the acceptance of the
acquisition by customers of the acquired business; the acceptance of
the acquisition by employees and agents of the acquired business;
potential operating changes necessitated in the acquired business by
the integration of the two companies as their operating processes
and systems are distinct and prone to significant differences; our
ability to realize expected synergies from the transaction; and the
realization of any liabilities related to the business being
acquired. ADC further cautions that any forward-looking statements
made by us in this report or in other announcements made by us are
qualified by numerous other important factors that could cause
actual results to differ materially from those in the
forward-looking statements. These statements and factors include,
without limitation: potential volatility in future sales; changes
in profit percentages; statements regarding and actually realized
earnings per share and other results of operations; expectations or
beliefs regarding the marketplace in which we operate and market
growth rates; the sufficiency of our cash balances and cash
generated from operating and financing activities for our future
liquidity; the demand for equipment by telecommunication service
providers, from which a majority of our sales are derived; the fact
our business is increasingly dependent on project-based capital
deployment initiatives by our customers for which sales are more
prone to significant fluctuations; our ability to operate our
business to achieve, maintain and grow operating profitability;
macroeconomic factors that influence the demand for
telecommunications services and the consequent demand for
communications equipment; consolidation among our customers,
competitors or vendors which could cause disruption in our customer
relationships or our displacement as an equipment vendor to the
surviving entity in a customer consolidation; our ability to keep
pace with rapid technological change in our industry; our ability to
make the proper strategic choices with respect to acquisitions or
divestitures; increased competition within our industry and
increased pricing pressure from our customers; our dependence on
relatively few customers for a majority of our sales as well as
potential sales growth in market segments we presently feel have the
greatest growth potential; fluctuations in our operating results
from quarter-to-quarter, which are influenced by many factors
outside of our control, such as variations in demand for particular
products in our portfolio that have varying profit margins; the
impact of regulatory changes on our customers' willingness to make
capital expenditures for our equipment and services; financial
problems, work interruptions in operations or other difficulties
faced by our customers or vendors, which can influence future sales
to customers as well as our ability to either collect amounts due us
or obtain necessary materials and components; economic and
regulatory conditions both in the United States and outside of the
United States, as a significant portion of our sales come from non-U.S.
jurisdictions; our ability to protect our intellectual property
rights and defend against infringement claims made by other parties;
possible limitations on our ability to raise additional capital if
required, either due to unfavorable market conditions or lack of
investor demand; our ability to attract and retain qualified
employees in a competitive environment; potential liabilities that
could arise if there are design or manufacturing defects with
respect to any of our products; our ability to obtain raw materials
and components and the prices of those materials and components,
which can be subject to volatility; our dependence on contract
manufacturers to make certain of our products; changes in interest
rates, foreign currency exchange rates and equity securities prices,
all of which will impact our results; our ability to successfully
defend or satisfactorily settle any pending litigation or litigation
that may arise; fluctuations in the telecommunications market, and
other risks and uncertainties, including those identified in the
section captioned Risk Factors in Item 1A of ADC's Annual Report on
Form 10-K/A for the year ended October 31, 2006 and as may be
updated in Item 1A of ADC's subsequent Quarterly Reports on Form
10-Q or other filings we make with the SEC. ADC disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise.
|
 |
|