Pace and 2Wire today announced that the companies have reached an agreement under which Pace proposes to acquire 2Wire for cash consideration of $475 million. The consideration includes 2Wire’s balance sheet cash at closing, expected to be approximately $55 million.
“This acquisition will strengthen our Americas business, extending Pace’s U.S. market coverage with entry into the tier one telco market," said Neil Gaydon, CEO of Pace, in a statement. "We have built a strong position in the United States with cable and satellite operators and 2Wire, with its expertise in the broadband residential gateway market, will enable us to address a full range of U.S. operator requirements.”
2Wire is currently owned by a consortium of strategic and financial investors including Alcatel-Lucent, AT&T, Telmex, Oak Investment Partners, Meritech Capital Partners, and Technology Crossover Ventures.
The transaction is conditional on (amongst other things) the approval of the shareholders of Pace and 2Wire and regulatory approvals. It is anticipated that the transaction will be completed during the fourth quarter of 2010.