US technology testing and assurance company, Viavi Solutions, will buy UK-based network testing company Spirent Communications in a deal valued at $1.27bn on a diluted basis.
Spirent provides automated testing for networks used by companies that offer 5G, cloud, and autonomous vehicle services.
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Viavi’s deal to buy the Spirent follows sales for the UK company falling far below expectations last year.
Spirent announced in October that the first part of 2023 would see significantly lower sales than the same period in 2022.
A slowdown in sales for Spirent is partly due to the issues faced by telecom providers which use its service. Over the past few years, the telecom industry has been dealing with increasing costs and cuts in consumer spending.
“Spirent is a business with a differentiated value proposition, diversified portfolio of technology solutions, deep customer relationships and talented people,” said Spirent’s chairman Bill Thomas.
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By GlobalData“Despite these strengths, we recognise that the Spirent Group has been operating against an increasingly challenging market backdrop,” Thomas added.
The total telecom and pay-TV service revenue in the UK was valued at $49.3bn in 2022, according to GlobalData’s UK Telecom Operators Country Intelligence report.
The market is expected to increase at a compound annual growth rate of two percent during the forecast period, 2022-2027, according to the report.
