PT's moves aim to fuel turnaround
Sonus Network Inc. has agreed to acquire Performance Technologies Inc. for approximately $30 million, or $3.75 a share, expanding its addressable market from $2 billion to $3 billion by 2017.
After the deal is completed, Performance Technologies (Nasdaq: PTIX), which does business as PT, will become a wholly owned subsidiary of the Massachusetts-based Sonus (Nasdaq: SONS).
The purchase price represents a premium of 25.8 percent to PT’s closing share price of $2.98 on Thursday. The deal was approved unanimously by the boards of each company.
PT’s stock was trading midday Friday at $3.71, up 24 percent.
The company employs 114 people with 60 employees in Rochester.
The transaction is expected to close in the first quarter, subject to PT stockholder approval and the satisfaction of other customary closing conditions. Sonus said it would have no comment on the positions of top executives of PT until the deal closes.
The transaction will be funded with Sonus’ current cash stores and is expected to be accretive to Sonus’ adjusted earnings per share for 2015 and mildly dilutive in 2014.
“Over our 32-year history, PT has been recognized for providing mission-critical solutions built on leading-edge technologies designed and supported by some of the best talent in our industry,” said John Slusser, president and CEO at PT. “In Sonus we find a dedicated team of kindred spirits, highly focused on driving continued growth in the next-generation network communications marketplace.”
The acquisition would give Sonus some key PT technology, including its diameter signaling controllers that will allow mobile operators to efficiently deploy 4G/LTE service, officials said. As the adoption of the mobile Internet grows, the diameter signaling controllers market is forecast to grow by an average of 42 percent a year through 2017, to reach nearly $1 billion.
“The combination of Sonus and PT allows us to address this significant opportunity by bringing together unique and complementary technologies in wireless and wireline network intelligence, thereby expanding our addressable market by 50 percent and advancing our mobility and virtualization strategies,” said Raymond Dolan, Sonus president and CEO.
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