Tyco Electronics announced today it will acquire ADC Telecom for $1.25 billion. This is a $12.75 per share all-cash deal, which is a good premium considering the stock was at $8.85 on Monday.
Tyco's acquisition of ADC is to further its broadband connectivity exposure.
According to Tom Lynch, CEO of Tyco Electronics, "ADC is a great fit as we continue to execute our strategy to create strong leadership positions in all of our connectivity businesses."
Lynch added, "The combination of ADC and Tyco Electronics creates an industry leader, with the scope and geographic scale to help customers deliver needed capacity from the core of the network all the way to the end user."
In addition, Tyco reported its preliminary results of the third quarter:
- Sales of $3.1 billion, an increase of 23 percent over the prior quarter
- GAAP EPS were $0.72 in the quarter, which included $0.02 per share of income related to other items net of restructuring charges
- Book-to-bill ratio was 1.06 for the quarter and 1.08 excluding Subsea Communications.
The company will report earnings resultsbefore trading begins on Thursday, July 22.
*Source:Tyco Electronics press release
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