Reliance to buy Radisys for $70m
July 12, 2018
Indian conglomerate Reliance Industries is to buy US telecoms firm Radisys for more than $70m to increase its 5G and IoT portfolio.
The acquisition, which is expected to close towards the end of this year, is for $1.72 per share in cash.
Radisys provides open telecoms to service providers worldwide. Headquartered in Hillsboro, Oregon, Radisys has nearly 600 employees with an engineering team based out of Bangalore, India, and sales and support offices globally. The firm delivers value to service providers and telecoms equipment vendors by providing open-centric software, hardware and service capabilities that enable the migration to next-generation network topologies.
Reliance’s digital communications and services initiatives fall under the Jio brand.
“Reliance and Jio have been disrupting legacy business models and establishing new global benchmarks,” said Akash Ambani, director of Reliance Jio. “Radisys’ top-class management and engineering team offer Reliance rapid innovation and development expertise globally, which complements our work towards software-centric disaggregated networks and platforms, enhancing the value to customers across consumer and enterprise segments. This acquisition further accelerates Jio’s global innovation and technology leadership in the areas of 5G, IoT and open source architecture adoption.”
The transaction is subject to certain customary closing conditions, including regulatory approvals and approval of Radisys’ shareholders, and is expected to close in the fourth quarter of 2018. Reliance intends to finance the transaction through its own internal accruals.
“The backing and support of India-based global conglomerate Reliance will accelerate our strategy and the scale required by our customers to further deploy our full suite of products and services,” said Brian Bronson, CEO of Radisys. “The Radisys team will continue to work independently on driving its future growth, innovation and expansion. The addition of Reliance’s visionary leadership and strong market position will enhance Radisys’ ability to develop and integrate large-scale, disruptive, open-centric end-to-end solutions.”
Covington & Burling is acting as legal advisor and Ernst & Young provided diligence and tax advisory services to Reliance. Raymond James & Associates is acting as financial advisor and Baker & McKenzie is acting as legal advisor to Radisys.
Reliance Industries is India’s largest private sector company, with a consolidated turnover of US$66.1bn, operating cash profit of $9.8bn and net profit of $5.5bn for the year ended March 2018. The company’s business interests span petroleum refining and marketing, petrochemicals, retail, hydrocarbon exploration and production, digital services, and telecommunications.
Radisys’ disaggregated and virtualised enabling technology leverages open reference architectures and standards, combined with open software and hardware to power business transformation for the telecoms industry. Its services organisation delivers systems integration expertise necessary to solve communications and content providers’ complex deployment problems.