American communications gear manufacturer Arris Group Inc. is in a takeover bid to buy British set-top box maker Pace Plc. The deal worth USD 2.1 billion is expected to close by the second half of the year. Arris will set up a new company in the UK following the deal. Both Arris and Pace make […]
American communications gear manufacturer Arris Group Inc. is in a takeover bid to buy British set-top box maker Pace Plc. The deal worth USD 2.1 billion is expected to close by the second half of the year. Arris will set up a new company in the UK following the deal.
Both Arris and Pace make products that support the OTT video market.
Arris Chief Executive Bob Stanzione said the combination would be able to better compete in an increasingly competitive market.
“Over the past several months, there have been a number of new entrants both on the side of new services that are being offered over-the-top, as well as new devices that are used at homes in order to translate those services to video streams to serve television sets,” Stanzione said on a conference call.
Pace shareholders will receive $2 in cash and 0.1455 new Arris shares for each share held, it was announced.
The deal represents a 28% premium to Pace’s Tuesday close. Arris shares jumped about 25% to $38.02 in extended trading. Arris’ largest customers include Comcast Corp, Time Warner Cable Inc and AT&T Inc, while competitors include TiVo Inc and Cisco Systems Inc.
Arris will fund the cash portion of the deal through a combination of cash and debt. The company said it had secured a loan from Bank of America Merrill Lynch to fund the transaction.
