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Alex
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Joined: 19 Sep 2006
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 Posted: Mon Apr 07, 2008 4:17 pm Post subject: Sierra Wireless Announces Acquisition of Cradlepoint, Inc. |
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| Quote: | VANCOUVER, April 7 - Sierra Wireless, Inc. (NASDAQ: SWIR, TSX: SW) announced today a definitive agreement to acquire CradlePoint, Inc. ("CradlePoint"), a privately-held developer and supplier of wireless networking products and docking solutions for mobile enterprise, industrial and consumer applications.
CradlePoint is located in Boise, Idaho and currently has 40 full time employees. The company is an innovative provider of mobile broadband networking solutions with unique products, including the PHS-300 personal hotspot and MBR-1000 mobile broadband router. CradlePoint achieved revenue of $6.5 million in 2007 and is expected to grow revenue to approximately $25 million in 2008.
"The acquisition of CradlePoint is consistent with our strategy of strengthening our differentiation and expanding our position in the mobile computing value chain", said Jason Cohenour, President and Chief Executive Officer of Sierra Wireless. "We believe that adding CradlePoint's mobile broadband networking and docking solutions to our product portfolio extends our offering and value proposition to mobile operators and vertical OEM customers. Furthermore, we believe that the Mobile Broadband Networking category is poised for rapid growth, and that CradlePoint brings innovative mobile networking technology and talent to our team. We view CradlePoint as an important strategic addition to our business."
"By joining forces with Sierra Wireless, CradlePoint gains immediate access to established global distribution channels, leading edge mobile broadband technology, product marketing expertise, large scale supply chain capabilities and working capital to drive further growth. We bring an innovative product line of mobile broadband networking devices powered by our unique WiPipe(TM) platform, and solid relationships with North American network operators, vertical OEMs, retail channels and application providers", said Pat Sewall, Chief Executive Officer of CradlePoint, Inc. "We are enthusiastic about becoming part of the Sierra Wireless team."
Acquisition Rationale
The combination of Sierra Wireless' leading mobile broadband solutions and CradlePoint's mobile networking technology and expertise is expected to deliver significant benefits:
- Establishes an immediate presence in the emerging, and potentially high growth, Mobile Broadband Networking category
- Expands our mobile computing product line up and addressable market, while leveraging our established global channels
- Strengthens our differentiation through enhanced IP networking and embedded software capability
- Expands our product offering and value proposition for key Vertical OEM customers in the industrial handheld segment
Acquisition Detail Under the terms of the definitive agreement, Sierra Wireless will pay cash consideration of $21.8 million and will issue 462,963 shares to the shareholders of CradlePoint. Based on our current stock price, this represents a total transaction value of $30.2 million. Following closing of the transaction, CradlePoint shareholders will hold approximately 1.5% of the combined entity, based on the issued and outstanding shares.
Completion of the acquisition is expected in July, 2008 and is conditional upon, among other things, regulatory and CradlePoint shareholder approval. CradlePoint shareholders representing more than a majority of outstanding shares have signed voting agreements in favor of the transaction.
Following closing, the business will be fully integrated into Sierra Wireless. Pat Sewall, CradlePoint's CEO, will become Vice-President and General Manager of the Sierra Wireless Mobile Broadband Networking product group in Boise, Idaho and will report to Trent Punnett, Senior Vice President of Marketing and Corporate Development.
CIBC World Markets Inc. was engaged by Sierra Wireless to provide a fairness opinion. Blake Cassels & Graydon LLP is serving as Sierra Wireless' Canadian counsel. Stoel Rives LLP is serving as U.S. counsel to CradlePoint. |
Last edited by Alex on Tue Apr 15, 2008 4:38 pm; edited 1 time in total |
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Alex
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Joined: 19 Sep 2006
Posts: 2014
Location: Dallas, TX
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| Posted: Mon Apr 07, 2008 4:20 pm Post subject: |
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HOLEY 5#!+
Congrats to Cradlepoint! |
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Michael
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Location: Cary, IL
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| Posted: Mon Apr 07, 2008 4:31 pm Post subject: |
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Lets hope that everything that CradlePoint started continues - just at a FASTER pace.
We are excited and Congrats to CradlePoint!
I am glad that this didn't happen on April 1st.
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JoeCHecht
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Joined: 05 Jan 2008
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| Posted: Tue Apr 08, 2008 10:25 am Post subject: Re: Sierra Wireless Announces Acquisition of Cradlepoint, In |
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| Quote: | | CradlePoint achieved revenue of $6.5 million in 2007 and is expected to grow revenue to approximately $25 million in 2008. |
| Quote: | | Acquisition Detail Under the terms of the definitive agreement, Sierra Wireless will pay cash consideration of $21.8 million and will issue 462,963 shares to the shareholders of CradlePoint. Based on our current stock price, this represents a total transaction value of $30.2 million. |
I think they started with 31 million in venture funding.
Expected $25 million in 2008... was this expectation before or after the merger?
The venture guys must be kept happy.
| Quote: | | Acquisition Rationale |
I wonder what the real story is...
Joe |
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skj9063
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Joined: 17 Feb 2008
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| Posted: Tue Apr 08, 2008 11:02 am Post subject: |
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| Quote: | | I think they started with 31 million in venture funding. |
Another well-researched comment, Joe? Do you have a reference for this or are you just making up numbers?
Who would take $31M in venture funding and then sell for $30.2M, and how would that make any venture guy happy?
Steve |
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JoeCHecht
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| Posted: Tue Apr 08, 2008 11:27 am Post subject: |
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| skj9063 wrote: | | Quote: | | I think they started with 31 million in venture funding. |
Another well-researched comment, Joe? Do you have a reference for this or are you just making up numbers?
Who would take $31M in venture funding and then sell for $30.2M, and how would that make any venture guy happy?
Steve |
I am truly offended Steve.
Of course, it depends on how you interpret what they wrote (given that I said "I think" as opposed to something like "they did")...
http://www.cradlepoint.com/about_team.php
Joe |
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kalen43
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Joined: 30 Apr 2007
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| Posted: Tue Apr 08, 2008 11:44 am Post subject: |
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| There goes customer service |
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JoeCHecht
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| Posted: Tue Apr 08, 2008 11:45 am Post subject: |
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| JoeCHecht wrote: | | Of course, it depends on how you interpret what they wrote |
I may need to stand corrected on this on.
Of course, with an expected revenue of $25 million in 2008 (if we assume those figures are pre-merger), it wtill does not quite add up.
Joe |
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visortgw
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Joined: 28 Oct 2005
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| Posted: Tue Apr 08, 2008 11:50 am Post subject: |
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| JoeCHecht wrote: | | skj9063 wrote: | | Quote: | | I think they started with 31 million in venture funding. |
Another well-researched comment, Joe? Do you have a reference for this or are you just making up numbers?
Who would take $31M in venture funding and then sell for $30.2M, and how would that make any venture guy happy?
Steve |
I am truly offended Steve.
Of course, it depends on how you interpret what they wrote (given that I said "I think" as opposed to something like "they did")...
http://www.cradlepoint.com/about_team.php
Joe |
Re-read the bio -- the $31M in venture funding was raised for an endeavor with Rightnow Technologies when Ryan Adamson worked there (i.e., nothing to do with Cradlepoint). |
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JoeCHecht
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| Posted: Tue Apr 08, 2008 12:17 pm Post subject: |
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| visortgw wrote: |
Re-read the bio -- the $31M in venture funding was raised for an endeavor with Rightnow Technologies when Ryan Adamson worked there (i.e., nothing to do with Cradlepoint). |
As I said, I may need to stand corrected on this on.
Joe |
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Hardware
EVDO Heavy User
Joined: 07 Dec 2007
Posts: 137
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| Posted: Tue Apr 08, 2008 12:29 pm Post subject: |
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Joe I think you ARE corrected on this one.
Read the facts before you spew out an opinion.
The purchase of CradlePoint should be a great thing in my opinion. Major resources and funding behind them will give them a chance to really explore this market.
Time will tell. |
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JoeCHecht
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| Posted: Tue Apr 08, 2008 1:22 pm Post subject: |
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| Hardware wrote: | Joe I think you ARE corrected on this one.
Read the facts before you spew out an opinion. |
Yes, Yes, Thank you so much.
Anyone else care to give me a keelhauling before we see a mysterious disappearance of posts?
Please form a single file line above...
Joe |
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skj9063
EVDO Fledgling
Joined: 17 Feb 2008
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| Posted: Wed Apr 09, 2008 3:17 pm Post subject: |
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| Quote: | | I am truly offended Steve. |
Then I apologize, my comment may have been too strident. I just seemed to me that the numbers obviously didn't make sense together. |
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JoeCHecht
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Joined: 05 Jan 2008
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| Posted: Wed Apr 09, 2008 4:43 pm Post subject: |
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| skj9063 wrote: | | Quote: | | I am truly offended Steve. |
Then I apologize, my comment may have been too strident. I just seemed to me that the numbers obviously didn't make sense together. |
No problem Steve. I had posted the numbers from memory (apparently a failing one at that). I too thought the numbers to be a little off.
I am always happy to stand corrected, and it is a good thing that you called me on it, and we got accurate info. Thanks!
I must admit though, I am still suspicious of the deal. Wish we knew if the projected sales where pre/post merger. I have seen a lot of these startups get bought out, with rosy press releases, and watch the products go down the drain in short order.
Joe |
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mfisch
EVDO User
Joined: 17 Dec 2007
Posts: 27
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| Posted: Thu Apr 10, 2008 1:24 pm Post subject: |
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What is Sierra's motivation here? It's obviously two fold:
Take the company out of the marketplace before a competitor gets there.
and
Help leverage existing sierra product lines.
Does anyone here think cradlepoint's superior compatibility matrix will look the same in 24 months?
This is great for the cradlepoint guys and I'm happy for them, its always good when the deal goes through (and this was only a matter of time and maximizing value).
I expect the current developing train will continue uninterrupted, however new developments will most certainly be centered around sierra products.
Thats okay, it leaves a nice space in the market in a couple years for competitors. I'll bet we see some of the other wireless manufacturers come up with their own versions (built in chipsets). |
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