Viavi Solutions Inc. (Viavi) has recently announced its definitive agreement to acquire Spirent Communications plc’s high-speed Ethernet and network security business lines from Keysight Technologies, Inc. for a total consideration of $410 million in cash, with an additional $15 million contingent cash consideration to be paid at closing. The acquisition is expected to close in the second quarter of calendar year 2025, shortly after the close of Keysight’s acquisition of Spirent.
Viavi anticipates that this transaction will add approximately $180 million to its Network & Service Enablement (NSE) revenue in the first 12 months after closing. Furthermore, it is expected to be accretive to earnings per share (EPS) 12 months after closing. Viavi also plans to utilize its US net operating losses to lower the combined group’s blended non-GAAP tax rate.
To fund the transaction, Wells Fargo has committed to providing a $425 million term loan B. Additionally, Viavi may elect to increase the amount of the term loan B for general corporate purposes on a “best-efforts” basis subject to market conditions.
This acquisition is seen as a strategic move for Viavi, as it is expected to enhance the company's engagement in the growing Ethernet, security, AI, and digital infrastructure end markets. Oleg Khaykin, President and CEO of Viavi, emphasized that the transaction brings an advanced Ethernet test and security product portfolio to Viavi in various segments including NEMS, enterprise, service providers, data center ecosystem, and government.
The acquisition of Spirent’s high-speed Ethernet and network security business lines appears to align with Viavi's broader strategy to expand its solutions in high-speed Ethernet and network security testing. It is a notable addition to Viavi’s Ethernet testing platform, providing an immediate infusion of software, hardware, and protocol domain expertise across network layers.
Viavi Solutions Inc. (NASDAQ: VIAV) is a global provider of network test, monitoring, and assurance solutions, serving various sectors including telecommunications, cloud, enterprises, first responders, military, aerospace, and railway. Additionally, Viavi is a leader in light management technologies for 3D sensing, anti-counterfeiting, consumer electronics, industrial, automotive, government, and aerospace applications. Today the company's shares have moved -0.4% to a price of $11.14. Check out the company's full 8-K submission here.
