Targets “high value” Trillium and ATCA products
RadiSys has said it is ready to buy Continuous Computing in a move designed to accelerate its move into the LTE, deep packet inspection and femtocell markets. The company will pay $105 million, with $73 million of that in cash, for Continuous Computing, with up to an an extra $18 million due in earn out payments over the three years following the acquisition. The transaction is expected to close by the end of July 2011.
A statement from RadiSys said that its board believes the acquisition of Continuous Computing has a number of “compelling strategic benefits”. The acquisition would “drive further expansion into the high growth LTE, Femto / Small Cell Wireless and DPI markets with [Continuous Computing’s] high performance ATCA platforms and Trillium software.”
Following the acquisition, Mike Dagenais, Continuous Computing President and CEO, will become RadiSys’ Chief Executive Officer. Brian Bronson, current Chief Financial Officer of RadiSys will become RadiSys’ President and Chief Financial Officer. Scott Grout, current President and Chief Executive Officer of RadiSys will become Vice Chair of the RadiSys Board of Directors.
Continuous Computing’s revenues were $56.6 million in 2010 and grew over 25% from 2009 with gross margins of approximately 50% in 2010. RadiSys has just reported Q1 revenues for 2011 of $73.6 Million, up 9.4% on Q1 2010.
A Continuous Computing spokesperson said, “We are excited about this transaction and believe the acquisition by RadiSys will broaden the company’s solutions portfolio and accelerate our expansion into high-growth communications areas. In addition, the acquisition will bring benefits to our end customers through a broader set of technologies and solutions delivered by a combined team with greater overall scale and breadth.”