Wireless Telecom Group, Inc. (NYSE MKT: WTT), a leader in advanced wireless communications solutions, has acquired CommAgility, Ltd., a privately held developer of embedded signal processing and RF modules, LTE PHY/stack software for 4G/5G mobile networks and related applications, the company said.
CommAgility, headquartered in Leicestershire, England, provides proprietary solutions enabling the customization of the LTE standard for small cell and private network applications in a variety of rapidly growing commercial and defense markets, including satellite communications, backhaul and research.
The acquisition is expected to be immediately accretive to Wireless Telecom´s gross and Adjusted EBITDA margins.
Total purchase consideration including an estimated range of earn-outs is expected to be between 4.5x and 6.2x CommAgility´s 2018 UK GAAP Adjusted EBITDA. Upfront equity consideration and employment agreements for the 4 founders aligns long-term equity interests.
The initial purchase price for CommAgility is comprised of USD 12.5m in cash and USD 6.25m of Wireless Telecom common stock. The total purchase consideration includes up to USD 12.5m of additional cash consideration in the form of a 24-month earn-out.
The cash portion of the consideration at close was funded from a combination of cash on hand and borrowings from a newly issued senior credit facility from Bank of America, N.A.
The board of directors of both companies unanimously approved the transaction which closed simultaneously with the execution of the definitive agreement.
B. Riley & Co., LLP is serving as exclusive financial advisor to Wireless Telecom Group and Bryan Cave LLP is serving as legal counsel. Convex Capital is serving as financial advisor and Rosenblatt LLP is serving as legal counsel to CommAgility.