EXFO to acquire Brix Networks in all-cash deal
-- Test & Measurement World, 4/15/2008 1:22:00 PM
EXFO Electro-Optical Engineering announced that it has signed an agreement to acquire all the shares of Brix Networks, a provider of open and extensible converged service assurance solutions.
Consideration to be paid consists of $28.5 million in cash and an additional earn-out based upon the achievement of booking levels exceeding $16 million in the 12 months following the closing date of the transaction. The deal is expected to be negative to earnings for the remainder of fiscal 2008, neutral in fiscal 2009, and accretive in 2010, excluding stock-based compensation costs and after-tax amortization of intangible assets. The company will be renamed EXFO Service Assurance Inc.
Brix Networks, a privately held company headquartered in Boston, MA, brings to EXFO deep expertise in IP service assurance technology that was developed through substantial R&D investments in the last nine years. The company's distributed probe-based solutions proactively monitor next-generation converged IP networks to assure that voice, video, and data services are delivered with the quality of service and quality of experience demanded by users.
Brix offers comprehensive VoIP and IPTV testing, 24 hours per day, 7 days per week, across the three most vital areas that impact the success of a real-time service: signaling quality (signaling path performance), delivery quality (media transport performance), and content quality (overall quality of experience).
"The automated, real-time service assurance solutions provided by Brix Networks are increasingly becoming mission-critical for network service providers (NSPs), given the non-deterministic nature of IP networking and because the growing number of consumers adopting IP services is too widespread for NSPs to rely on expensive truck rolls to handle such tests," said Germain Lamonde, EXFO's chairman, president, and CEO. "This strategic acquisition represents another step in EXFO's long-term growth strategy, enabling us to expand share of wallet with NSPs through Brix Networks' deep technological advantage, global customer relationships, and strong market presence in the fast-growing service assurance market. We believe that network monitoring is the next logical step in our strategic plan, given the 64% compound annual growth rate in the last two years of our protocol test business, which focuses on next-generation IP networking. The combination of Brix Networks, recently-acquired Navtel Communications, and EXFO will create a new force in the test and monitoring marketplace with full technology lifecycle coverage for NSPs."
Brix Networks will be recognized as part of EXFO's protocol test activity, under it's Telecom Division, once the transaction closes, which is expected later in the second quarter.
EXFO Electro-Optical Engineering, www.exfo.com.
