DEAL PEGGED AT $600MN
French media and entertainment technology company Technicolor is buying computer networking giant Cisco Systems’ set-top box and related home broadband equipment business for roughly $600 million. The deal will result in Technicolor becoming the No. 2 company worldwide in what is called “customer premises equipment” — phone gear, cable and satellite TV set-top boxes, routers and switches, and home monitoring devices — with total sales of roughly $3.3 billion and a 15 per cent market share.
“Video is what is driving traffic today,” Technicolor CEO Frederic Rose told a conference call. “All this is fuelling a massive demand for customer premises television equipment.” The deal is expected to close in the 4th quarter of 2015 or 1st quarter of 2016. According to media reports, the acquisition will double the annual revenue at Technicolor’s connected-home unit, giving it a business that ships 60 million devices a year and has an installed base of about 290 million set-top boxes.