Spirent Communications plc Signs Definitive Agreement to Acquire the Business of DAX Technologies Corp.

Addition of DAX’s Customer Experience Management Solutions Strengthens Spirent’s Service Assurance Portfolio

LONDON--()--Spirent Communications plc (LSE: SPT) (“Spirent”), a leading communications technology company, announces today that it has entered into a definitive agreement to acquire the business of DAX Technologies Corp. (“DAX”), privately held by Dragos Alexe and others, for a cash consideration of $37.0 million, funded from existing cash resources. Based in Matawan, New Jersey, DAX is a leading provider of Customer Experience Management (“CEM”) solution software that enables mobile and wireline service providers to understand and quantify services as experienced by their customers.

The DAX InTouch software is a uniquely comprehensive customer experience and service quality management solution, able to aggregate and analyse data from a wide eco-system of existing sources, including probes, network equipment and end user devices, as well as from carriers’ business systems that handle processes such as trouble ticketing. Processing billions of network and business records each day, InTouch gives service providers real-time insights into their customers’ experience, providing actionable end-to-end analytics to operations, support, marketing and engineering teams. DAX InTouch customers are primarily top-tier wireless service providers in North America, together with other service providers in EMEA.

“Our service provider customers are deploying converged networks that need to support an ever-increasing range of rich applications and associated data traffic. These complex networks generate massive amounts of data, yet provide a limited understanding of the customer experience,” said Eric Hutchinson, CEO of Spirent. “The addition of DAX positions Spirent well to help service providers with the unprecedented challenges they face when developing and managing new services in mobile and wireline network environments of rapidly increasing complexity. This acquisition will enable us to strengthen our Service Assurance portfolio, expanding Spirent’s addressable market in the live network.”

Converging multi-technology 3G and 4G/LTE networks and services, such as VoLTE, require the use of big data analytics to fully understand the customer experience. The acquisition of DAX will enable Spirent to combine measurements and data from its solutions in the lab and in live networks, delivering high value solutions and expertise that help its customers deploy and manage complex new networks and services faster and more effectively.

“Rapid change in the mobile eco-system brings many opportunities and InTouch has quickly established a leading position in the fast-growing CEM segment,” said Frank Galuppo, CEO of DAX Technologies. “Spirent’s scale, together with the breadth and depth of its service provider relationships, will enable the business to grow beyond its current success.”

Spirent is committed to supporting and enhancing DAX’s existing portfolio of solutions and services and meaningful additional revenue will be achieved from Spirent’s scale and relationships with service providers. Further benefits will be realised through combining InTouch with Spirent’s solutions in the lab and in live networks to deliver high value added solutions.

Spirent expects that this transaction will be earnings enhancing and cash generative in the first full year, and have a return on investment in excess of cost of capital.

The transaction is structured as an acquisition of the business, subject to customary closing conditions and is expected to complete within one week of signing. For the year ended 31 December, 2012 DAX reported profit before tax of $6.8 million and gross assets of $6.8 million.

About Spirent Communications plc

Spirent Communications plc is a global leader in test and measurement inspiring innovation within development labs, communication networks and IT organisations. We enable today’s communication ecosystem as well as tomorrow’s emerging enterprises to deploy life enriching communications networks, devices, services and applications. Further information about Spirent Communications plc can be found at http://corporate.spirent.com/.

Spirent Communications plc Ordinary Shares are traded on the London Stock Exchange (ticker: SPT). The Company operates a Level 1 American Depositary Receipt (“ADR”) programme with each ADR representing four Spirent Communications plc Ordinary Shares. The ADRs trade in the US over-the-counter (“OTC”) market under the symbol SPMYY and the CUSIP number is 84856M209. Spirent ADRs are quoted on the Pink OTC Markets electronic quotation service which can be found at http://www.otcmarkets.com/otc-pink/home.

Spirent and the Spirent logo are trademarks or registered trademarks of Spirent Communications plc. All other trademarks or registered trademarks mentioned herein are held by their respective companies. All rights reserved.

Cautionary statement regarding forward-looking statements

This document may contain forward-looking statements which are made in good faith and are based on current expectations or beliefs, as well as assumptions about future events. You can sometimes, but not always, identify these statements by the use of a date in the future or such words as "will", "anticipate", "estimate", "expect", "project", "intend", "plan", "should", "may", "assume" and other similar words. By their nature, forward-looking statements are inherently predictive and speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. You should not place undue reliance on these forward-looking statements, which are not a guarantee of future performance and are subject to factors that could cause our actual results to differ materially from those expressed or implied by these statements. The Company undertakes no obligation to update any forward-looking statements contained in this document, whether as a result of new information, future events or otherwise.

Contacts

Spirent Communications plc
Eric Hutchinson, Chief Executive Officer
Rachel Whiting, Chief Financial Officer
+44 (0)1293 767676
or
FTI Consulting
James Melville-Ross/Sophie McMillan/Emma Appleton
+44 (0)20 3077 0500

Release Summary

Spirent announces today that it has entered into a definitive agreement to acquire the business of DAX Technologies Corp. (“DAX”), privately held by Dragos Alexe and others.

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Contacts

Spirent Communications plc
Eric Hutchinson, Chief Executive Officer
Rachel Whiting, Chief Financial Officer
+44 (0)1293 767676
or
FTI Consulting
James Melville-Ross/Sophie McMillan/Emma Appleton
+44 (0)20 3077 0500