“Radisys Corporation… a global leader of open telecom solutions…and Reliance Industries Limited, India’s largest private sector company, have entered into a definitive agreement under which Reliance will acquire Radisys for $1.72 per share in cash,” a joint statement by the two companies said.
RIL plans to fund the transaction through its internal accruals, the statement added. The deal is expected to close in the fourth quarter of 2018, subject to regulatory approvals.
The Radisys acquisition — the latest in the series by RIL — will bolster the conglomerate’s bouquet of technology and telecom offerings.
Headquartered in Hillsboro, Oregon, Radisys has nearly 600 employees. The company also has an engineering team in Bengaluru, along with sales and support offices globally, the statement said.
“The Radisys team will continue to work independently on driving its future growth, innovation and expansion. The addition of Reliance’s visionary leadership and strong market position will enhance Radisys’ ability to develop and integrate large-scale, disruptive, open-centric end-to-end solutions,” said Brian Bronson, CEO of the US-based company Radisys.
For the first quarter of calender year 2018, Radisys posted a GAAP net loss of $6.4 million, while the consolidated revenue stood at $26.2 million.
Akash Ambani, director of Reliance Jio, said: “Radisys’ top-class management and engineering team offer Reliance rapid innovation and solution development expertise globally, which complements our work towards software-centric disaggregated networks and platforms, enhancing the value to customers across consumer and enterprise segments.”
The deal will give more firepower to Reliance Jio – the newest and the most aggressive entrant in the telecom sector — in building a strong portfolio in new-age areas such 5G and Internet of Things.
In March this year, Reliance Industries had inked an agreement to merge its music streaming service JioMusic with digital music service Saavn to create a combined entity that would be valued at $1 billion. Earlier this month, RIL completed the acquisition of close to 73% stake in artificial intelligence-based education technology provider Embibe. It plans to invest $180 million into the company over the next three years.
In December 2017, Mukesh Ambani-led Reliance Jio had also announced a mega deal to acquire mobile business assets including spectrum, mobile towers and optical fibre network of RCom, owned by his younger brother Anil Ambani.
As such, Jio has been engaged in a bruising tariff war in the Indian telecom market, with its free voice and rock-bottom data offerings, challenging the established operators like Bharti Airtel, Vodafone and Idea Cellular whose revenue and profitability have come under tremendous pressure.