ADVA, ADTRAN to Merge

Yesterday there was a major M&A move over in the vendor space. ADTRAN and ADVA have announced plans to combine their businesses in an all stock transaction that pays a 22% premium to ADVA’s stock price averaged over the last three months.

If successful, the deal will merge two complementary businesses. Alabama-based ADTRAN of course tends to focus on the access side of things, while Germany-based ADVA does more on the core. Both also have expertise at the edge of course.

The combined business will have revenues of $1.2B and be able to offer end-to-end solutions on a global scale. Annual run-rate synergies of $52M are envisioned over the two years after closing. There will be plenty of integration work along the way to get there of course.

If everything goes through and all shares are tendered, ADTRAN shareholders would own 54% of the combined company, while ADVA shareholders will own the other 46%. The company, which will operate as ADTRAN, will be listed both in Frankfurt and on the NASDAQ.

The HQ will be in Huntsville AL, while its European HQ will of course be in Munich, Germany. ADTRAN Chairman and CEO Tom Stanton and CFO Mike Foliano and ADVA CTO Christoph Glingener will keep those titles, while ADVA CEO Brian Protiva will shift to EVP. The new board will have 6 from ADTRAN and 3 from ADVA.

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Categories: Mergers and Acquisitions · Telecom Equipment