Telrad Networks to buy Alvarion's wireless access business
JERUSALEM (Reuters) - Telrad Networks will buy the broadband wireless access business of Israeli wireless broadband technology firm Alvarion Ltd (ALVR.TA) for $6.1 million, the companies said.
Alvarion ALVR.O may also receive certain performance-based milestone payments of up to $6 million.
Last week, Alvarion delayed the release of its fourth-quarter earnings to March 6 due to ongoing negotiations to sell its licensed carrier business.
The deal is expected to close in the second quarter.
Telrad, an Israeli provider of telecom equipment and services, said it made the deal since broadband wireless access (BWA) is experiencing rapid growth worldwide because it enables wireless connectivity to meet the need for Internet services in areas with little or no access infrastructure.
Ran Buskspan, Telrad's chief executive, said he saw a strategic fit between the two businesses and significant growth potential.
"We share a common level of technological know-how that will provide a great deal of synergy as we integrate the BWA division into our company," he said. "The market is poised to adopt next-generation wireless technologies and we see BWA as a core growth engine for our company in coming years."
Alvarion and Telrad also agreed to sign a reseller agreement according to which Alvarion will continue to provide carrier licensed solutions to its partners and distributors and Telrad will provide Alvarion's unlicensed systems to its carrier customers after the transaction is completed.
Alvarion said it will now focus on carrier-grade systems in the unlicensed frequencies.
"This new focus will allow us to concentrate our resources and attention on our target markets and on successfully completing our turnaround plan," said Alvarion President and CEO Hezi Lapid.
Telrad, which is 90 percent owned by private equity funds group Fortissimo Capital, expects to have sales of $120 million in 2013.
(Reporting by Steven Scheer)