CommScope to obtain $150 million credit facility via Wachovia

By Sara Rosenberg

New York, Oct. 27 - CommScope Inc. is expected to obtain a new $150 million senior secured credit facility to help fund its acquisition of Avaya Inc.'s Connectivity Solutions (ACS) business. Wachovia Securities is the lead bank on the deal.

A date for the bank meeting has not yet been set and the structure of the facility has not yet been determined, a source close to the deal told Prospect News on Monday, adding that "it depends on a lot of factors."

The acquisition is valued at approximately $263 million. Under the agreement, Avaya will receive $210 million in cash, an $18 million convertible subordinated note from CommScope and $34.9 million in CommScope common stock, subject to adjustment, according to a news release.

The cash portion will be funded through existing cash balances and the proposed credit facility. CommScope had $171 million in cash and cash equivalents on its balance sheet as of Sept. 30.

The transaction, which is subject to customary closing conditions and approval by necessary regulatory authorities, is expected to close within 90 days, except with regard to certain international operations.

"ACS is an excellent strategic fit and a logical step in the continued growth and development of CommScope as we execute our last mile strategy," said Frank M. Drendel, chairman and chief executive officer, in the release. "This transaction represents a unique opportunity to acquire a preeminent industry player at an attractive valuation and establish CommScope as a global leader in the enterprise LAN area."

CommScope is a Hickory, N.C. manufacturer and marketer of a broad line of coaxial, fiber-optic and other high-performance electronic cable products.

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