U.S.-based Viavi Solutions has agreed to buy Spirent Communications, a leading telecommunications testing firm based in UK, for about 1.01 billion pounds ($1.28 billion).
The combination of Viavi and Spirent’s current and future product offerings will position the combined group to bring to market innovative solutions across high-growth cloud service providers, enterprise/IT networks, 5G private networks, 6G+ and positioning, navigation and timing verticals.
Operational efficiencies anticipated to result in annual run-rate cost synergies of up to $75 million approximately two years after the completion of the acquisition.
“Combining our leading communications test and measurement and optical technologies and Spirent’s testing and assurance solutions is expected to deliver enhanced product solutions and applications, accelerate growth in new markets and strengthen innovation through expanded engineering and design capabilities, Oleg Khaykin, President and CEO of Viavi, said news statement.
Spirent shareholders will get 175 pence per share, which includes a special dividend of 2.5 pence per Spirent share in place of any final dividend for the year ended Dec. 31, 2023.
The per-share deal value is at a premium of about 61.4 percent to Spirent’s closing price of 108.4 pence on March 4.
Shares of Spirent jumped as much as 60 percent to 173.5 pence per share in early trade on Tuesday.
The deal is expected to help Viavi Solutions boost its expertise in artificial intelligence and machine learning, security, cloud-native architecture and automation.
As part of the deal, private equity firm Silver Lake will make a long-term investment of $400 million in Viavi Solutions.
