Technicolor has agreed to acquire Cisco's customer premises equipment (CPE) business for approximately €413 million ($450 million) in cash and approximately €137 million ($150 million) in newly issued Technicolor shares,
The companies also agreed to enter into a strategic partnership that will allow both companies to develop and deliver next generation video and broadband technologies, with cooperation on Internet of Things (IoT) solutions and services. Technicolor and Cisco also have signed a long-term patent cross-licensing agreement that covers specific intellectual property and patents from both companies.
Technicolor said the acquisition will make it one of the global leaders in CPE , increasing its industrial and technological scale in all major geographies:
- c.15% market share worldwide;
- c.60 million devices shipped each year and a global presence with an installed base of c. 290 million set-top-boxes and c.185 million gateways in over 100 countries;
- c.€3 billion n of pro-forma revenues in 2014, doubling Technicolor’s revenues in the Connected Home segment;
- Synergies generation in excess of €100 million per annum on a run-rate basis, in particular in the field of supply chain and SG&A;
- Strengthened innovation capabilities with over €250 million of combined annual spending in Research and Innovation.
In addition, Mr. Hilton Romanski, Senior Vice President and Chief Strategy Officer of Cisco, will join Technicolor’s Board of Directors.
“The strategic relevance of video to every consumer, business, city and country around the world is only growing, and the market is moving rapidly," said John Chambers, Chairman and CEO of Cisco. “This is the right time and we have the right company in Technicolor to drive the future of the CPE business to deliver what our customers and partners need, today and into the future. At Cisco, we are prioritizing our investments to deliver on our strategy of video in the cloud, and will partner with Technicolor to position the CPE business and employees for future success.”
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http://www.technicolor.com/en/who-we-are/press-news-center/press-releases/technicolor-acquire-cisco-connected-devices-division-eu550m-stock-and-cash
