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Tyco to pay $1.25bn to buy ADC
14 July 2010
ADC CEO Bob Switz negotiates a sale to Tyco Electronics for $1.25bn in cash
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ADC
Tyco
Bob Switz
Barclays
Morgan Stanley
Two equipment makers, Tyco Electronics and ADC Telecommunications, are to merge in a deal that values ADC at $1.25 billion.
The combined organization will add ADC’s distributed antenna system products, which will expand Tyco Electronics’ wireless connectivity portfolio to provide greater mobile coverage and capacity solutions to carrier and enterprise customers. Additionally, Tyco will add ADC’s professional services organization in the US to its business.
Tyco CEO Tom Lynch said: “ADC is a great fit as we continue to execute our strategy to create strong leadership positions in all of our connectivity businesses.”
Bob Switz, ADC’s chairman and CEO, added: “I have great respect for Tyco Electronics and know that they share our commitment to meeting customers’ changing next generation network needs.”
In an interview with Global Telecoms Business in 2009, ex-CFO Switz was then saying that ADC planned to spend the $300 million it had in the bank on acquisitions. “Our target at this point is probably up to $100 million per transaction,” he told GTB.
Switz had spent six years reshaping ADC, focusing the company on two key areas: fibre, particularly fibre to the home and fibre inside enterprises, and in-building wireless access. “ADC has gone from being a supermarket of communications to becoming a much more focused company,” he told GTB. The Tyco transaction is expected to close by the end of 2010. The company will pay $12.75 a share, 44% higher than its current share price.
Barclays was appointed as financial adviser and law firm Davis Polk and Wardwell as legal adviser by Tyco Electronics on the deal. ADC named Morgan Stanley as financial adviser and Dorsey & Whitney as the legal advisers. GTB
Global Telecoms Business interview with Bob Switz of ADC: http://www.globaltelecomsbusiness.com/Article/2224977/Search/Results/Interview-Bob-Switz-of-ADC.html?Keywords=switz