From Business Division To Boardroom: CommScope's New Stakes And Role In France's Vantiva Post-Major Deal

Vantiva SA TCLRY has entered into a call option agreement to acquire CommScope Holding Company, Inc.'s COMM Home Networks division. 

In return, CommScope will receive a 25% ownership stake in Vantiva.

Under the terms of the transaction, CommScope would also get a maximum cumulative earnout of $100 million in cash contingent upon Vantiva (at constant scope) achieving an EBITDA equal to or exceeding €400 million in a given fiscal year over the five years following the first full year after closing. The maximum payment in a year would be $50 million.

The deal would significantly increase Vantiva's Connected Home capabilities. In the last twelve months ending June 2023, CommScope Home Networks and Vantiva's Connected Home generated $[1.5]billion and €[2.0]billion in sales, respectively.

Upon completing the transaction, CommScope will become a significant shareholder in Vantiva and demonstrate its support by appointing a representative to Vantiva's Board of Directors. 

Additionally, CommScope will commit to an 18-month lock-up period for the acquired Vantiva shares, underscoring its long-term investment and confidence in the partnership.

The transaction, which is expected to be completed in late Q4 2023, would also be subject to the receipt of regulatory approvals and customary closing conditions.

Also Read: Hackers Leak CommScope's Personal Data On Dark Web

Price Action: COMM shares closed higher by 2.38% at $3.44 on Monday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.