DragonWave completed its acquisition of Nokia Siemens Networks’ microwave transport business last week (1 June 2012) including its associated operational support system (OSS) and related support functions.
Nokia Siemens Networks retains responsibility for its existing solution sales and associated services for microwave transport, while DragonWave is responsible for the microwave transport product line, including R&D, product management and operations functions. As previously announced on 3 May 2012, Nokia Siemens Networks will continue to provide R&D and other support to the business through a services arrangement.
As part of the acquisition, DragonWave is now the preferred strategic supplier of packet microwave and related products to Nokia Siemens Networks and the two companies will jointly coordinate technology development activities.
DragonWave plans to rebrand the products acquired from Nokia Siemens Networks as “Harmony” products. Under the terms of the Master Acquisition Agreement, DragonWave will continue the support and development of these products, which will also be sold via Nokia Siemens Networks under the FlexiPacket brand through its existing channels as part of its end-to-end mobile broadband solution set.
‘In closing this acquisition, we’ve established a new level of collaboration with Nokia Siemens Networks that positions DragonWave strategically for continued growth,’ said DragonWave President and CEO Peter Allen. ‘The new Harmony line we’re adding to our portfolio is backed by unmatched service and support and further bolsters our ability to participate in the tremendous growth in LTE networks worldwide.’
The business was acquired by one of DragonWave’s wholly-owned subsidiaries, DragonWave S.à r.l. The purchase price consists of €10.6m (£8.6m) in cash, subject to customary post-closing adjustments, and 2,000,978 common shares of DragonWave.
Under the Master Acquisition Agreement, Nokia Siemens Networks is subject to a lock-up restricting sale or disposition of the shares, subject to customary exceptions. The Master Acquisition Agreement also includes a capital lease or similar deferred sale agreement from Nokia Siemens Networks to DragonWave of approximately €3.9m (£3.1m) of equipment.
Approximately 130 employees of Nokia Siemens Networks based in Shanghai (China) are expected to transfer to DragonWave once the closing of the acquisition of operations in China is complete.