Tekelec Subsidiary IEX Corporation Sells for $200 Million
Posted April 28, 2006
MORRISIVLLE, N.C. — After a fairly short negotiation period,
(NASDAQ: TKLC)has announced it will sell all shares of its wholly owned subsidiary, IEX Corporation to NICE Systems for $200 million in cash. IEX was orginally bought by Tekelec in 1999 for $165 million; its technology supports the backbone for workforce management for customer call centers.
The transaction is scheduled to close prior to June 2006, subject to customary regulatory approvals and audits, says company spokesperson, Jim Chiafery, Tekelec's director of investor relations.
Chiafery also explained that Tekelec was not in the market to sell it's division, however last fall the company received some unsolicited offers that were "very credible."
"To ensure that IEK remained a market leader, it was going to require an investment in a non-core asset, and we were reluctant to make make this investment," Chiafery said.
The cash deal with NICE represents four times the annualized sales IEX as reported in September 2005.
"We are very pleased with this transaction because it converts a non-telecom business unit into cash at an attractive valuation and under favorable terms. IEX has been an important contributor to our financial performance for the last several years, but it was not a component of our long-term telecom systems growth strategy, said Frank Plastina, president and CEO of Tekelec.
Tekelec also reports that there is no immediate plans for the profits, and the deal will significantly strengthen Tekelec's balance sheet to consider other strategic opportunities in the company's core business of telephony.
Haim Shani CEO of NICE Systems commented, "We are very happy to have IEX join the NICE family. IEX was the natural choice for us in expanding and accelerating the execution of our strategy to lead the Insight from Interactions(TM) revolution in the contact center and enterprise. We are excited about redefining our market space together and introduce a paradigm shift in how contact center management and enterprise executives make decisions, monitor and improve performance."
In a separate transaction from the IEX Corporation, NICE Systems has signed a second definitive agreement to acquire Performix for a total purchase price of $13.2 million in cash. Performix is also a provider that manages contact center performance. The Performix purchase price may be increased by up to an additional $6.15 million based on certain performance criteria (of which up to $3 million at closing). Performix is based in Burlington, Massachusetts, with operation centers throughout North America, the U.K. and Ireland.