Business briefs
Sales of smartphones are growing more than 30 percent a year and netbooks are taking root. As a result, Naperville-based Tellabs' mobile customers expect mobile data traffic to grow 30 to 50 percent a year for the foreseeable future. Such high growth demands scalable, next-generation network architectures to deliver 3G and 4G services.
That's why Tellabs, a leader in mobile backhaul networks, will acquire WiChorus of San Jose, Calif. The combination creates advanced 3G/4G mobile networks that revolutionize the mobile Internet, deliver new applications to generate revenue and simplify networks to achieve significant savings for mobile carriers.
"As we expand logically into an adjacent market with the SmartCore platform, Tellabs and WiChorus can help mobile customers succeed by revolutionizing the mobile Internet," said Robert W. Pullen, chief executive officer and president of Tellabs. "Our customers are excited about this combination, since they can deliver rich, distinctive personalized user experiences such as mobile Internet, video and commerce. This move complements, differentiates and advances our growth solutions portfolio including Tellabs Mobile, Optical and Business Solutions."
Under the terms of the transaction, which was approved by both companies' boards of directors, Tellabs will pay approximately $165 million in net cash for WiChorus. The transaction is expected to be dilutive to Tellabs' earnings in 2010, then additive to Tellabs' non-GAAP earnings in 2011 and beyond. Non-GAAP earnings exclude amortization associated with acquired intangibles and other purchase accounting adjustments.
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