NEW YORK: US telecommunications equipment maker CommScope Holding Co Inc is in talks to acquire set-top box maker Arris International PLC in a bid to expand its offerings, people familiar with the matter said on Wednesday.
The deal talks come as the popularity of video online streaming is putting pressure on telecommunications companies to upgrade their infrastructure and consolidate relationships with hardware equipment suppliers.
Both Arris’ and CommScope’s businesses have been challenged as a result of some of their products being seen by their customers as more commoditised and easily substituted. CommScope shares have lost close to half their value since last April, prompting the company to consider potential deals as an answer to its woes.
The negotiations between CommScope and Arris are ongoing and there is no certainty a deal will be reached, the sources said, asking not to be identified because the matter is confidential. Arris and CommScope declined to comment.
Arris shares jumped as much as 13 per cent on the report of the talks and closed up 6.7 per cent at $24.06 on Wednesday, giving the company a market value of $4.3 billion. CommScope shares closed down 4.6 per cent at $24.43, giving it a market value of $4.7 billion.
It is not clear how CommScope would fund the deal, though it would likely have to use its stock as currency to pay for a large portion of it. — Reuters
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