Expected to be Accretive (Non-GAAP) By the End of
2024
Expected to Increase Ceragon's Global Market Share in the mmW
Market and Augment Offering with PtMP Solutions, Primarily for
Fixed Wireless Access
Company to Host Conference Call October 24 at 8:30 a.m.
ET
ROSH
HA'AIN, Israel,
Oct. 24,
2023 /PRNewswire/ -- Ceragon Networks Ltd. (NASDAQ:
CRNT), the global innovator and leading solutions provider of 5G
wireless transport, today announced that it has entered into a
definitive agreement to acquire Siklu, a provider of multi-Gigabit
"wireless fiber" connectivity in urban, suburban and rural areas,
for an enterprise value of $13-15
million. As consideration to Siklu's shareholders, Ceragon will
issue approximately 1.5 million ordinary shares. Ceragon is
expected to assume financial liabilities of approximately
$10-12 million, of which
approximately $2.5 million are
classified as long-term debt.
Ceragon is expected to generate approximately $25-$29 million in
incremental 2024 revenue from this acquisition. The acquisition is
expected to be accretive to the consolidated gross margins of
Ceragon as Siklu's margins are at levels significantly higher than
Ceragon's historical margins. Ceragon management expects the
combination to improve Siklu's results by leveraging Ceragon's
working capital management capabilities, as well as expanded
profitability following synergies. Inclusive of these
business improvements, management anticipates the transaction to be
accretive to non-GAAP earnings by the second half of 2024.
Doron Arazi, Ceragon CEO, said
"We expect this combination to accelerate our growth strategy, by
improving our key financial metrics and reducing customer
concentration in the short and long run. We have identified
near-term opportunities to bring Siklu products to regions and
customers where Ceragon has an established presence, and, for the
longer term, to combine Ceragon products to create a more
comprehensive offering primarily to private networks and small
service providers in general, and leveraging Siklu's
millimeter-wave leadership position in North America to increase our presence in this
key market in particular."
"In addition to increasing our market share in the millimeter
wave bands, which is anticipated to be the growth segment within
wireless transport market in the coming years, this acquisition is
expected to provide us with an entry point to PtMP technology in
general and Fixed Wireless Access in particular," added Mr.
Arazi.
As part of this transaction, Ceragon will expand its total loan
credit facility by $5 million to
$77 million total, and Siklu's
primary lender will join Ceragon's lending consortium.
Operating in the millimeter wave bands since 2008, Siklu's
wireless solutions have been used by service providers (primarily
small ones), Private Networks and system integrators for many years
for providing Wireless Transport and Access solutions. Siklu has
deployed over 300,000 outdoor antenna units to date in over 50
countries. Siklu has been the leader in market share of E-band
installations in the US for the last three years. The Company has
approximately 60 employees globally, including deep technical
expertise in radio frequency communications and PtMP technology.
Siklu is known in the industry for rapid deployments, ease of use
solutions, robust testing capabilities and innovation, traits that
align well with Ceragon.
"Siklu has built an impressive team, with deep technical
expertise and an enviable corporate culture, along with industry
leading technology in the markets it serves," added Arazi.
Mr. Ronen Ben Hamou, Siklu's CEO,
added, "We see Ceragon as the perfect partner for Siklu, in both
technology, market, and cultural fit."
The closing of the transaction is subject to customary closing
conditions. Ceragon expects the deal to close by the end of
2023.
Conference Call Details
Ceragon Networks will host a Zoom web conference with analysts
and investors today, October 24, 2023, at 8:30 a.m. ET.
Interested parties are invited to register for the web conference
by clicking this link. A replay of the conference will be made
available on Ceragon's investor relations website within 24 hours
following the conclusion of the live call.
About Siklu
Siklu delivers multi-Gigabit "wireless fiber" connectivity in
urban, suburban and rural areas. Operating in the millimeter wave
bands, Siklu's wireless solutions are used by leading service
providers and system integrators to provide 5G Gigabit Wireless
Access services. For more information, visit www.siklu.com.
About Ceragon Networks
Ceragon Networks Ltd. (NASDAQ: CRNT) is the global innovator and
leading solutions provider of 5G wireless transport. We help
operators and other service providers worldwide increase
operational efficiency and enhance end customers' quality of
experience with innovative wireless backhaul and fronthaul
solutions. Our customers include service providers, public safety
organizations, government agencies and utility companies, which use
our solutions to deliver 5G & 4G broadband wireless
connectivity, mission-critical multimedia services, stabilized
communications, and other applications at high reliability and
speed.
Ceragon's unique multicore technology and disaggregated approach
to wireless transport provides highly reliable, fast to deploy,
high-capacity wireless transport for 5G and 4G networks with
minimal use of spectrum, power, real estate, and labor resources.
It enables increased productivity, as well as simple and quick
network modernization, positioning Ceragon as a leading solutions
provider for the 5G era. We deliver a complete portfolio of turnkey
end-to-end AI-based managed and professional services that ensure
efficient network rollout and optimization to achieve the highest
value for our customers. Our solutions are deployed by more than
600 service providers, as well as more than 1,600 private network
owners, in more than 130 countries. For more information please
visit: www.ceragon.com
Ceragon Networks® and FibeAir® are registered trademarks of
Ceragon Networks Ltd. in the United
States and other countries. CERAGON ® is a trademark of
Ceragon Networks Ltd., registered in various countries. Other names
mentioned are owned by their respective holders.
Safe Harbor
This press release contains statements that constitute
"forward-looking statements" within the meaning of the Securities
Act of 1933, as amended and the Securities Exchange Act of 1934, as
amended, and the safe-harbor provisions of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements are
based on the current beliefs, expectations and assumptions of
Ceragon's management about Ceragon's business, financial condition,
results of operations, micro and macro market trends and other
issues addressed or reflected therein. Examples of forward-looking
statements include, but are not limited to, statements regarding
the benefits and the timing of the transaction as well as
statements regarding the companies' products, prospects and results
following the transaction and the effect of the evolving nature of
the recent war in Gaza between
Israel and the Hamas. You may
identify these and other forward-looking statements by the use of
words such as "may", "plans", "anticipates", "believes",
"estimates", "targets", "expects", "intends", "potential" and
similar expressions, or the negative of such terms, or other
comparable terminology (although not all forward-looking statements
contain these identifying words that are intended to identify
forward-looking statements).
Although we believe that the expectations reflected in such
forward-looking statements are based upon reasonable assumptions,
we can give no assurance that our expectations will be obtained or
that any deviations therefrom will not be material. Such
forward-looking statements involve known and unknown risks and
uncertainties that may cause the actual results, performance or
achievements of both Ceragon and Siklu to be materially
different from any future results or performance to differ
materially from those anticipated, expressed or implied by such
forward-looking statements. These risks and uncertainties include,
but are not limited to: the risk that the transaction may not be
completed in a timely manner or at all, which may adversely affect
the companies' businesses and the price of Ceragon's traded
securities; uncertainties as to the timing of the consummation of
the transaction and the potential failure to satisfy the conditions
to the consummation of the transaction; delays, disruptions or
increased costs in the integration of Siklu's business with
Ceragon; unanticipated restructuring costs may be incurred or
undisclosed liabilities assumed; attempts to retain key personnel,
customers, and vendors may not succeed; risks related to diverting
management's attention from Ceragon's ongoing business operations;
exposure to inflation, currency rate and interest rate fluctuations
and risks associated with doing business locally and
internationally, as well as fluctuations in the market price of
Ceragon's traded securities; the effect of the evolving nature of
the recent war in Gaza between
Israel and the Hamas; the impact
of general economic conditions on the on Ceragon's and Siklu's
business; ongoing or potential litigations or disputes, incidental
to the conduct of Siklu's ongoing business, with customers,
suppliers, landlords, or other third parties; potential adverse
reactions or changes to business relationships resulting from the
announcement or completion of the transaction; potential negative
changes in general economic conditions in the regions or the
industries in which Ceragon and Siklu operate; and such other
risks, uncertainties and other factors that could affect our
results of operation, as further detailed in Ceragon's most recent
Annual Report on Form 20-F, as published on May 1, 2023, and in Ceragon's other filings with
the Securities and Exchange Commission ("SEC") as well as
other documents that may be subsequently filed by Ceragon from time
to time with the SEC.
We caution you not to place undue reliance on forward-looking
statements, which speak only as of the date hereof. Ceragon does
not assume any obligation to update any forward-looking statements
in order to reflect events or circumstances that may arise after
the date of this release unless required by law.
Ceragon's public filings are available on the SEC's website at
www.sec.gov and may also be obtained from Ceragon's website at
www.ceragon.com.
Investor & Media Contact:
Rob Fink or Bob Meyers
FNK IR
Tel. 1+646-809-4048
crnt@fnkir.com
Logo -
https://mma.prnewswire.com/media/1704355/Ceragon_Networks_Ltd_Logo.jpg
View original
content:https://www.prnewswire.com/news-releases/ceragon-networks-to-acquire-siklu-expanding-presence-with-private-networks-and-small-service-providers-in-north-america-301965671.html
SOURCE Ceragon Networks Ltd.