2Wire sold to Pace for $475M
In a bid to get a firmer grasp on the North American market, Pace is buying 2Wire for about $475 million.
The set-top and gateway maker has yet to crack the Americas with anywhere near the success it has had in the European and Asian markets. It has been doing some business with Comcast over the years, most recently supplying the MSO with DTAs. It also has a supplier agreement with DirecTV.
2Wire, meanwhile, is a key supplier of the residential gateways that AT&T uses for its U-verse services. MTS Allstream is another 2Wire customer.
Pace CEO Neil Gaydon made it clear that getting a foothold in the North American market was the key to the deal. He stated: "This acquisition will strengthen our Americas business, extending Pace's U.S. market coverage with entry into the Tier 1 telco market. We have built a strong position in the U.S. with cable and satellite operators, and 2Wire, with its expertise in the broadband residential gateway market, will enable us to address a full range of U.S. operator requirements. 2Wire's software and gateway expertise will further drive development of our home entertainment convergence strategy."
Pace recently claimed to be the top-selling digital set-top box company in the world, and with the acquisition of 2Wire, it would also become the No. 1 provider of telco residential gateway devices in the U.S. and the third-largest provider globally.
2Wire is currently owned by a consortium of strategic and financial investors including Alcatel-Lucent, AT&T, Telmex, Oak Investment Partners, Meritech Capital Partners and Technology Crossover Ventures.