GWINNETT–July 23, 2015 — Technicolor (Euronext Paris: TCH; OTCQX: TCLRY) has entered into an exclusive agreement with Cisco (NASDAQ: CSCO) to acquire its customer premises equipment (CPE) business for $600 million in a cash and stock transaction, reviewed by the Boards of Directors of the two companies, which will be on a cash free, debt free basis.
Cisco’s Atlanta operation, which employs about 1,600 and includes a Lawrenceville campus, represents Cisco’s Video Communications and Video Technology groups.
Under the terms of the agreement, upon the closing of the transaction, Cisco will receive approximately $450 million in cash and approximately $150 million in newly issued Technicolor shares, subject to certain adjustments provided for in the agreement.
Simultaneously to the acquisition, Technicolor and Cisco will enter into a strategic partnership that will allow both companies to develop and deliver next generation video and broadband technologies, with cooperation on Internet of Things (IoT) solutions and services. The strategic agreement will provide ongoing commitment to all existing customers and expand offerings. By combining their strengths and leading video expertise, from content creation to in-home delivery, the two companies will accelerate innovation and forge a leading entity that network service providers can rely on for their next generation connected home experiences. Technicolor and Cisco also have signed a long-term patent cross-licensing agreement that covers specific intellectual property and patents from both companies. As part of the strategic agreement and after the transaction has closed, Mr. Hilton Romanski, Senior Vice President and Chief Strategy Officer of Cisco, will join Technicolor’s Board of Directors.
“We know that video expertise is essential to the future of creating outstanding network and home infrastructure products and services,” said Frederic Rose, CEO of Technicolor. “Through this acquisition and strategic agreement, Technicolor can immediately bring its unrivalled experience and innovation in video creation, delivery, and display to more customers in more geographies, while strengthening our position as a technology leader.”
“The strategic relevance of video to every consumer, business, city and country around the world is only growing, and the market is moving rapidly,” said John Chambers, Chairman and CEO of Cisco. “This is the right time and we have the right company in Technicolor to drive the future of the CPE business to deliver what our customers and partners need, today and into the future. At Cisco, we are prioritizing our investments to deliver on our strategy of video in the cloud, and will partner with Technicolor to position the CPE business and employees for future success.”
The transaction is expected to close by the end of the fourth quarter of 2015 or during the first quarter of 2016, subject to regulatory approvals and customary closing conditions.
Technicolor, a worldwide technology leader in the media and entertainment sector, is at the forefront of digital innovation. Our world class research and innovation laboratories enable us to lead the market in delivering advanced video services to content creators and distributors. We also benefit from an extensive intellectual property portfolio focused on imaging and sound technologies, based on a thriving licensing business. Our commitment: supporting the delivery of exciting new experiences for consumers in theatres, homes and on-the-go. For more information on Technicolor, please go to www.technicolor.com
Cisco (NASDAQ: CSCO) is the worldwide leader in IT that helps companies seize the opportunities of tomorrow by proving that amazing things can happen when you connect the previously unconnected. For ongoing news, please go to http://thenetwork.cisco.com.
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