Tellabs Inc. (TLAB:US) agreed to be acquired by Marlin Equity Partners in a deal valued at about $891 million, letting the unprofitable phone-equipment maker regroup as a private company.
The board approved the transaction after more than 30 potential buyers were contacted, Naperville, Illinois-based Tellabs said today in a statement. The offer of $2.45 a share is 4.3 percent higher than Tellabs’s closing price on Oct. 18, the most recent trading day.
Tellabs has posted 11 straight money-losing quarters as the company shifts from older phone-network switches to more popular equipment for wireless systems. It suffered a dual blow last year when Chief Executive Officer Rob Pullen died of cancer and Chairman Mike Birck announced he would step down from the board after being diagnosed with leukemia.
“This transaction will deliver to Tellabs stockholders certainty of value and liquidity, immediately upon closing,” Vince Tobkin, the company’s current chairman, said in the statement.
Tellabs shares (TLAB:US) rose 4.7 percent to $2.46 at the close in New York. The stock has climbed 7.9 percent this year.
Birck, Tellabs’s co-founder, remains the company’s second-largest stockholder and has told the company that he supports the transaction, according to the statement. Goldman Sachs Group Inc. advised Tellabs on the deal, while Credit Suisse Group AG and Evercore Partners Inc. (EVR:US) were the financial advisers to Marlin Equity.
“We view Tellabs’s business as an ideal opportunity to capitalize on the growth in the telecom network equipment sector,” Nick Kaiser, a partner at Los Angeles-based Marlin, said in a statement.
The transaction is expected to close in the current quarter.
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