DragonWave announced changes to its existing operational framework with Nokia Siemens Networks
Under the terms of the renewed framework, Nokia Siemens Networks will provide DragonWave with an immediate cash payment of €10.6M and Nokia Siemens Networks will take on additional commitments and costs. The companies agreed to terminate the the Italian R&D component of the deal, thereby reducing DragonWave's operating costs by approximately €3M per quarter. DragonWave expects to pay a termination fee totaling approximately €7M over the balance of fiscal year 2014.
DragonWave will continue to be the preferred, strategic supplier to Nokia Siemens Networks of packet microwave and related products, and the companies will jointly coordinate technology development activities. DragonWave has rebranded the products acquired from Nokia Siemens Networks as "Harmony" products and will continue the support and development of these products, which will also be sold via Nokia Siemens Networks.
In addition to the new arrangements with Nokia Siemens Networks, DragonWave confirmed that as part of ongoing cost reductions it has also recently reduced its senior management positions by 33%.
"The new arrangements being announced today are intended to streamline our operations and customer outreach strategy to better serve Nokia Siemens Networks and its customers. We look forward to continuing to pursue market opportunities together with Nokia Siemens Networks," said DragonWave President and CEO Peter Allen.
http://www.dragonwaveinc.com
- In November 2011, DragonWave announced a deal to acquire Nokia Siemens Networks' microwave transport business, including its associated operational support systems (OSS) and related support functions, in a transaction that at the time was valued at up to EUR 110 million.
