British set-top maker Pace Plc (LSE: PIC.L) purchased equipment maker Aurora Networks for $310 million in a deal that is expected to produce $8 million in synergies by year-end and boost the company's 2014 earnings. Pace also will pay an additional $13 million in tax benefits upon closing the deal.
Pace said the acquisition will help it expand beyond its core business and build deeper relationships with its customers by helping them deliver more cost-effective broadband. The company said Aurora will operate as a strategic business unit of Pace and will be managed by its existing senior management team.
Pace makes media servers and set-top boxes for DirecTV (Nasdaq: DTV), Comcast (Nasdaq: CMCSA) and AT&T (NYSE: T). In the second quarter, the company reported revenue from North America was up 62 percent to $839 million.
Aurora Networks makes optical systems used by cable companies to build fiber networks. The company's product line includes amplifiers, transmitters, receivers and switches. Aurora reported an annual revenue of $217 million for the year ending March 31.
In its second quarter earnings report, Pace said it has shipped over 2 million advanced whole-home HD DVRs for DirecTV since its launch in June 2012 and that next-generation devices are now in production. Pace also said it was selected by GCI to deploy a TiVo (Nasdaq: TIVO)-enabled media server solution and won deals with Liberty Global (Nasdaq: LBTYA) and Get TV.
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