DRAGONWAVE ADDS LEADERSHIP TECHNOLOGY TO ADDRESS CARRIER CONVERGENCE NEEDS WITH ACQUISITION OF AXERRA NETWORKS, INC.
- Created on Thursday, 14 October 2010 00:00
Acquisition enhances pseudowire capability and expands customer base
DragonWave Inc. (TSX: DWI; NASDAQ: DRWI) a leading global supplier of packet microwave radio systems for mobile and access networks, today announced its acquisition of Axerra Networks, Inc. (“Axerra”). Axerra is well known in the mobile network industry as a leader in pseudowire technology and has a product portfolio that allows carriers to address the increasing need to carry legacy TDM traffic over a packet based network. The DragonWave management team will discuss this transaction on a conference call this morning, details listed below.
Axerra’s industry leading portfolio of pseudowire products will strengthen and complement DragonWave’s packet microwave products. The combined product portfolio will result in a robust converged solution delivering TDM and packet services over a single packet network that can operate over both microwave and fiber backhaul. The new product portfolio will strengthen DragonWave’s solution for existing 2G and 3G networks and their evolution to 4G packet architectures.
DragonWave has acquired Axerra in an all cash transaction valued at $9.5 Million on a debt free basis. An additional sales performance based earn out phase over the next 16 months could potentially raise the value of the transaction by up to $15.5 Million should Axerra meet certain revenue growth targets. Any earn out which becomes payable may be paid in cash or DragonWave Common Shares, subject to applicable securities laws, at DragonWave‘s option.
“This acquisition represents a key step in our customer and portfolio diversification strategy,” said Peter Allen, President and CEO of DragonWave, “The unique technology differentiators of Dragonwave and Axerra are totally aligned and complement each other to meet the backhaul requirements of next generation 3G/4G networks. This will also strengthen our customer diversification as it brings a significant position with a Tier 1 US MSO.”
Axerra’s scalable pseudowire enabled products are being used globally by both Tier 1 and Tier 2 carriers as a mobile backhaul solution to meet the rapidly increasing demand for economical, high speed mobile broadband. When deployed in cell sites and central offices, the Axerra AXN family of transport and switching solutions enable a new era in mobile backhaul by supporting both legacy 2G/3G and next generation 4G services over a common packet network backhaul infrastructure.
“We are excited to join the DragonWave team, we believe our combined solution set will help enhance our product portfolio and expand the range of opportunities available to us in the future,” said Hezi Lapid, CEO of Axerra.
