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Viavi Solutions Inc. a network equipment manufacturer, is evaluating the possibility of making a new bid for Spirent Communications (LSE:SPT) if the proposed acquisition by Keysight Technologies Inc. fails to secure approval from regulatory authorities, according to reports from Reuters.
In March, Viavi’s previous offer of 175 pence per share for Spirent was surpassed by Keysight's bid of 201.5 pence per share, which successfully captured the attention of Spirent’s shareholders. Despite this initial excitement, Spirent's shares are currently trading below the earlier offer price, reflecting a 13% discount. This price movement has led some to express skepticism regarding the likelihood of the Keysight acquisition proceeding as planned.
Typically, when a takeover offer is announced, company shares tend to rally to reflect their implied valuation based on the offer. However, the ongoing discount in Spirent's stock price indicates uncertainty about the outcome of the deal with Keysight.
in its half-year results released in August, Spirent reported a more than 20% decline in order intake compared to the previous year. The company attributed this decrease to customer hesitancy stemming from the recent acquisition announcement by Keysight, as well as broader industry challenges that are contributing to a slowdown in business activity.
Spirent has confirmed that it is actively engaging with regulatory authorities alongside Keysight to address all necessary conditions for the deal's approval. The outcome of these discussions will be critical in determining the future trajectory of both Spirent and the for Viavi’s renewed interest in the company should the Keysight acquisition falter.
