MRV Communications based in Chatswoth, California, a provider of advanced network solutions for data centres, service providers and enterprises, announced an agreement under which ADVA Optical Networking will acquire MRV via a tender offer of $10.00 per share for all its outstanding common stock.
The tender offer represents an aggregate purchase price of approximately $69 million. The transaction has been approved and unanimously recommended by both the board of directors of ADVA and that of MRV Communications.
ADVA expects that the proposed acquisition will further strengthen its portfolio of optical, Ethernet and software solutions and expand its customer base, particularly in non–European regions. In 2016, MRV recorded revenue of $80.3 million; for the most recent quarter ended March 31, 2017, MRV recorded revenue of $21.2 million, up 12.1% year on year, and net loss of $1.0 million, versus a net loss of $3.9 million a year earlier. MRV had cash and cash equivalents of $21.7 million and no debt.
For its first quarter ended on March 31, 2017, ADVA reported revenue of Euro 141.83 million, up 16.3% versus the first quarter of 2016, with net income of Euro 6.18 million, compared with a net loss of Euro 5,16 million in the 2016 first quarter.
ADVA noted that the acquisition of MRV, if completed, will mark its second significant acquisition in two years. In 2016, it acquired Overture Networks to expand its Carrier Ethernet portfolio and create a NFV product suite, named Ensemble. Earlier this year, Ensemble was selected by Verizon for its virtual uCPE solution.
The acquisition of MRV remains subject to customary closing conditions, including the tender of at least a majority of MRV's outstanding shares of common stock, and is expected to be completed in August or September of this year.
Regarding the transaction, Uli Dopfer, CFO of ADVA said, "The acquisition of MRV will… not only strengthens ADVA's cloud access portfolio, but also open the door to new customers… this acquisition will present many new business opportunities, especially for communication service providers seeking to explore the possibilities of virtualised network services".
- MRV Communications was founded in 1988 by Prof. Shlomo Margalit and Dr. Zeev Rav-Noy. The company is headquartered in Chatsworth, California and has R&D centers in Chelmsford, MA, and Yokneam, Israel.
