APRIL 15, 2010 -- Enablence Technologies Inc. (TSX-V: ENA) has signed a definitive merger agreement to acquire privately held Teledata Networks Ltd. of Israel. Teledata makes equipment for communications over copper-based infrastructure.
The $50 million acquisition price will comprise US$10 million in cash, US$10 million in secured interest-bearing promissory notes payable on the second anniversary of the closing of the transaction, and US$30 million in common shares to be issued by Enablence at the closing based on a pricing formula contained in the agreement.
Completion of the deal is subject to “certain conditions,” including the approval of the TSX Venture Exchange and Teledata shareholders, as well as satisfying other customary conditions. The transaction is expected to close following the completion of the applicable statutory waiting periods in Israel.
Teledata’s customer base spans millions of lines in over 55 countries worldwide, including Brazil, Chile, Costa Rica, Kazakhstan, and South Africa, many of which are Tier 1 service providers, Enablence asserts.
“With this merger, Enablence will become a strategic player in the global broadband market, with the critical mass to meet the needs of service providers in established and emerging markets and the ability to service Tier 1 operators internationally,” said Arvind Chhatbar, chairman of Enablence.
“Teledata focuses on emerging markets with its BroadAccess platform. The BroadAccess family provides wireline service providers with an optimal solution for delivery of advanced triple-play and business services over copper, and enables a smooth migration to next-generation networks and FTTx network architectures,” said Tim Thorsteinson, the incoming CEO of Enablence. “With Teledata’s capabilities, Enablence will be able to serve its current customers that wish to extend the useful life of their existing copper networks. Teledata’s customers will benefit from having Enablence’s GPON and Active Ethernet solutions to migrate their existing copper networks to fiber.”
The current majority shareholders in Teledata include the Kardan group (Euronext: KARD), Elron Electronic Industries (TASE: ELRN), and Infinity Venture Capital Fund.
Paradigm Capital Inc. served as financial advisor to Enablence on this transaction.
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