VIAVI Solutions Acquires Spirent for $1.27B

In a strategic move to enhance its position in the test, assurance, and security solutions sector, VIAVI Solutions has announced its acquisition of Spirent Communications for an estimated $1.27 billion.

This is technology M&A deal number 59 that ChannelE2E and MSSP Alert have covered so far in 2024. See more than 2,000 technology M&A deals for 2024, 2023, 2022, 2021, and 2020 listed here.

VIAVI Solutions, founded in 2015, is headquartered in Chandler, Arizona. The company has 4,493 employees listed on LinkedIn. VIAVI Solutions’s areas of expertise include software and hardware platforms and instruments for physical, virtual and hybrid networks and anti-counterfeiting solutions for currency authentication.

Spirent Communications, founded in 1936, is based in San Jose, California. The company has 2,038 employees listed on LinkedIn. Spirent Communications’s areas of expertise include 5G, telecoms, cybersecurity, testing, network service assurance, GNSS, GPS, satellite, network testing, benchmarking, service performance testing, 800G, network security, service experience testing, cloud, virtualised network testing, Ethernet, active assurance, 800G, lab to live, and positioning, navigation and timing.

Transaction Overview

As part of the acquisition, Silver Lake will make a $400 million long-term investment in VIAVI Solutions. This investment is expected to provide additional resources for the newly combined entity to pursue further growth and development opportunities.

The acquisition will be financed through VIAVI’s existing cash reserves, a newly secured $800 million term loan, and the strategic investment by Silver Lake. Advisory services for the transaction were provided by Qatalyst Partners, Wells Fargo Securities, and others

Reasons For The Deal

The acquisition aligns two companies with complementary product portfolios in networking and mission-critical infrastructure, including 5G and 6G technologies, according to VIAVI. 

The merged entity aims to deliver integrated solutions across various sectors, emphasizing cloud services, enterprise IT networks, and private 5G networks. 

Expected operational efficiencies are projected to yield up to $75 million in annual cost synergies within two years following the acquisition's finalization, the company said. VIAVI also intends to use US net operating losses to reduce the overall non-GAAP tax rate.

VIAVI Acquires Spirent: Executive Statements

Sir Bill Thomas, chairman, Spirent, commented:

"The Board intends to unanimously recommend this cash offer, recognizing the benefits for our shareholders, employees, and other stakeholders through this strategic combination."

Eric Updyke, CEO, Spirent, said:

"Joining forces with VIAVI will enhance our global offerings and enable us to capitalize on long-term growth opportunities."

Oleg Khaykin, president and CEO, VIAVI, added:

"The combination of VIAVI and Spirent will drive innovation and competitiveness, benefiting our customers and the industries we serve."