Andrew Corp. and Allen Telecom Inc. () have signed a definitive agreement under which Andrew will acquire Allen in a stock-for-stock transaction valued at approximately US$500 million. This strategically important and highly complementary combination establishes Andrew as the preeminent global wireless infrastructure subsystems supplier, with capabilities to provide total customer solutions, including virtually the entire base station RF footprint.

With relationships with every major global OEM and operator, a product portfolio of unrivaled breadth, and local sales, manufacturing, and distribution presence in every major region of the world, Andrew is ideally positioned to support CDMA, TDMA and GSM wireless standards, as well as emerging 3G technologies.

The combined company will be the number one global supplier of coaxial cables, RF power amplifiers, terrestrial microwave antennas, network geolocation solutions, and repeaters and in-building systems; and the number two global merchant provider of filters and base station antennas.

Andrew is now positioned in the telecommunications industry to generate both accelerated near-term growth from its expanded presence in these key market segments and to capture a greater portion of the $20 billion wireless infrastructure subsystems market.

The transaction is expected to be accretive to Andrew earnings per share in the first full year following completion and will be structured to qualify as a tax-free exchange. The company sees substantial opportunities for synergies and cost savings — in excess of $40 million in annual cost savings following integration — from efficiencies in manufacturing, purchasing, research and development, and sales, general and administration.

Under terms of the agreement, which has been unanimously approved by the Boards of Directors of both companies, Allen shareholders will receive 1.775 shares of newly-issued Andrew stock for each Allen share that they currently own. Based on Andrew's closing price of $9.01 per share on Feb. 14, 2003, the consideration represents a 21% premium over Allen's share price on the same day. Following completion of the transaction, on a fully diluted basis, excluding Allen preferred stock, Andrew shareholders will own approximately 64% and Allen shareholders will own approximately 36%.

Following completion of the transaction, the combined company will have nearly 7000 employees, pro forma annual revenues of approximately $1.3 billion, and annual R&D spending of $90 million.
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