Hickory's CommScope Doubles In Size With $7.4B Deal for Cable Box Maker
Hickory-based CommScope is about to more than double in size. The telecommunications equipment company says it's buying cable set-top box maker Arris for $7.4 billion in cash. The deal includes repaying Arris's debt and is being financed in part with $1 billion from investment firm The Carlyle Group.
Arris makes equipment for communications companies, including cable set-top boxes and cable modems, which would be new products for CommScope. CommScope supplies equipment for wired and wireless networks.
The combined company would have more than $11 billion in revenue. CommScope had sales of $4.6 billion last year, while Arris reported revenues of about $6.6 billion.
The deal still needs approval from regulators and Arris shareholders. It's expected to close in the first half of 2019.
Commscope's headquarters will remain in Hickory. Officials say they expect to maintain a big presence in Suwanee, Georgia, where Arris is based.
Commscope says it expects $150 million in annual cost savings once the merger is done.
In a press release, CommScope CEO Eddie Edwards said buying Arris gives the company new avenues for growth.
“After a comprehensive evaluation of our business and the evolving industry we operate in, we are confident that combining with Arris is the best path forward for CommScope to grow and provide the greatest returns for shareholders,” Edwards said.
He said it would allow CommScope to offer "end-to-end wired and wireless communications infrastructure solutions that neither company could otherwise achieve on its own."
Added Arris CEO Bruce McClelland: “CommScope is an ideal partner for Arris. In addition to providing immediate and substantial cash value to our shareholders, we are excited for what this combination will deliver for our customers, partners and employees around the world."
CommScope has 24,000 employees worldwide, including several thousand at plants in North Carolina as well as 230 at its Hickory headquarters. The combined company will have about 32,000 employees before any restructuring.
Nov. 8, 2018, CommScope and Arris announcement of the $7.4 billion deal