Keysight Technologies has agreed a $1.6 billion deal to acquire rival Ixia as the testing and measurement market undergoes more consolidation.
The two vendors said the combined business would provide end-to-end solutions for assessing performance from the mobile device to the data centre and the cloud.
The board of directors of both companies have unanimously approved the transaction, which is anticipated to close no later than the end of October 2017 subject to regulatory approval.
The deal represents a 45 percent premium on Ixia’s share price on 1 December 2016, when reports began to circulate that it was looking to sell up.
Ron Nersesian, Keysight president and CEO, said: "The combination creates a powerful innovation engine to fuel growth, expands our software-centric solutions and builds new opportunities through sales and technology leverage.
“Ixia also brings a world-class level of talent, and together, we will provide leading-edge solutions that address the fastest-growing communications and networking trends including 5G, IoT, visibility, security and application performance."
Bethany Mayer, Ixia president and CEO, added: "Ixia and Keysight share many of the same values including our dedication to innovation of leading-edge technologies, and commitment to operational excellence and financial discipline, which combine to create value for shareholders.
“We also have industry-leading IP portfolios that are complementary, deep technical prowess and amazing teams.
“We believe that together, Ixia and Keysight have a tremendous opportunity to further strengthen our market leading positions and create unprecedented value for our customers, partners, employees and shareholders.”