The Carlyle Group has agreed to take private CommScope, a maker of infrastructure for communications networks, in a deal valued at $3.9 billion.
Carlyle’s offer of $31.50 per share represents an about 36 percent premium over CommScope’s closing stock price on 22 October.
The deal is expected to close in the first quarter of 2011.
“As a private company, we believe CommScope will have greater flexibility to focus on our long-term strategic direction,” Eddie Edwards, president and chief operating officer of CommScope, said in a statement.
CommScope’s shareholders must vote on the transaction. The company also has 40 days to solicit alternative offers. Carlyle is entitled to a $43.3 million break-up fee if CommScope’s board accepts an alternative offer by 5 December.
Carlyle will make the investment from its fifth buyout fund, a $13.7 billion fund, and its Carlyle Europe Partners III, €5.4 billion fund. The two funds are relatively young, both raised in 2007.
With about $320 million of its $1 billion commitment drawn, the California Public Employees’ Retirement System shows Carlyle V with a -5.8 percent internal rate of return and a .90x multiple, as of 31 March, 2010.
Carlyle Europe Partners III has a -20.9 percent IRR, with a .60x multiple, according to CalPERS performance data as of 31 March.
Carlyle agrees $3.9bn tech take-private
The firm has agreed to acquire CommScope, which makes infrastructure for communications networks. Carlyle will make the investment from its $13.7bn fifth buyout fund, and its €5.4bn Europe Partners III.