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Efficient Networks (Nasdaq: EFNT) climbed 86 percent Thursday morning, rising US$10.69 to $23.06, after the company said it has agreed to be acquired by European telecom giant Siemens for US$1.5 billion.
Efficient, a Dallas, Texas-based provider of broadband digital subscriber line (DSL) services, said that Siemens' Information and Communications Networks Group (Siemens ICN) will start a tender offer for the company at $32.50 per share, in a bid to strengthen its global leadership position in the DSL broadband access market.
"With the strong presence of Siemens ICN in over 160 countries, this acquisition will empower us to further accelerate the growth of our business, and enhance our ability to drive the global adoption of broadband networks and services," said Mark Floyd, founder and chairman of Efficient Networks.
Floyd will become president of the access solutions division of Siemens ICN.
According to Roland Koch, president of Siemens ICN, the acquisition is a "key element" in Siemens strategy to strengthen its product portfolio and increase profitability. Siemens expects to complete the Efficient acquisition in April.
"With our focus on broadband access solutions, we can now offer our customers comprehensive end-to-end solutions, dramatically increasing our presence in this rapidly growing market segment," Koch said.
Efficient also announced that it won a one-year contract to provide external modems to SBC Communications.
Efficient has approximately 600 employees, and provides services to customers
including AOL Time Warner, BellSouth and Sprint. The company had sales of
$102 million in the quarter ended December 31st, with a loss before
interest, tax and amortization of $8.6 million.
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