Tuesday September 9 4:01 PM EDT
Company Press Release
Source: Glenayre Technologies Inc.
Glenayre To Acquire Two Companies and Divest Microwave Business
Acquisitions Will Promote Growth In Paging and Enhanced Service Platform
CHARLOTTE, N.C., Sept. 9 /PRNewswire/ -- Glenayre Technologies Inc. (Nasdaq:GEMS) today announced plans to
acquire Wireless Access Inc., a private developer and marketer of innovative two-way paging devices, and Open
Development Corporation (ODC), a private developer of enhanced service software and products for telecommunications
providers. The transactions are valued at approximately $148 million. Glenayre also announced plans to divest its microwave
radio unit (Wireless Interconnect Group, previously Western Multiplex Corporation).
``We are taking a significant strategic step to concentrate our resources on two primary growth engines -- paging and
enhanced service platforms for telecommunications providers,'' said Gary Smith, Glenayre president and chief executive
officer. ``The addition of Wireless Access and ODC will help drive our growth in these two core areas. We look forward to
the leadership contributions the management of these two companies will provide, and we welcome their employees to
Glenayre.
``Wireless Access reinforces our leadership role in paging by allowing us to offer a comprehensive paging system, from
infrastructure to the newest generation of paging devices,'' Smith explained. ``ODC's prepaid/debit and post- paid card
systems allow us to strengthen our position as one of the top worldwide providers in the enhanced service platform market to
the telecommunications sector. This in turn helps our customers remain competitive with products like voice mail, prepaid/debit
cards, voice-activated dialing and personal number services.
``Our microwave business has been a profitable operation for us,'' Smith said. ``It excels in state-of-the-art technologies and
the division's employees have contributed to Glenayre's success. However, it serves different customers than those of our
paging and enhanced services businesses, and we feel divestiture will allow both Glenayre and the microwave group to better
focus on their respective core markets.''
Glenayre has hired Donaldson Lufkin & Jenrette to solicit appropriate purchase offers for the microwave radio unit. Smith
indicated sale of the microwave unit depends on receipt of an acceptable offer.
Glenayre has signed a letter of intent to acquire Wireless Access for approximately $100 million in cash and options. Glenayre
also signed a letter of intent to acquire ODC for approximately $48 million in cash and options. The transactions will be
accounted for under the purchase method and are expected to close in the fourth quarter of 1997. As a result of these
acquisitions, Glenayre will take a pre-tax charge in the fourth quarter of 1997 related to the write-off of purchased in-process
research and development.
Following the closing of these transactions, Wireless Access and ODC optionholders will have the right to purchase shares
equivalent to less than 3% of Glenayre's Common Stock on a fully-diluted basis.
Wireless Access is a private Santa Clara, California company that develops and markets advanced two-way pagers. Wireless
Access provides Glenayre with significant new growth opportunities in the rapidly expanding worldwide arena of two-way
paging, with licensing for Motorola's family of high-speed protocols, including ReFLEX 25, ReFLEX 50 and InFLEXion
Voice.
``Wireless Access design capabilities allow Glenayre to participate in the largest and fastest-growing segment of the paging
industry - paging devices,'' Smith said. ``Alphanumeric paging device sales in the U.S. grew 53 percent last year. And Wireless
Access is at the forefront of the industry's evolution to two-way paging. We anticipate Wireless Access sales to total
approximately $18 million for 1997, with continued strong growth in 1998.''
Open Development Corp., based in the Boston area, develops and markets software applications and platforms that enhance
telecommunications networks and services. ODC has uniquely combined advanced client/server computing, high performance
relational database technology and an open architecture into its ``openMEDIA'' platform. ODC's products include: standard
prepaid calling card systems; prepaid wireless systems, which allow cellular subscribers to make calls using a prepaid account;
and enhanced calling card systems, which allow service providers to offer traditional post-paid calling card services with the
advanced features of openMedia. ODC sales are anticipated to be in the $15 million to $18 million range for full-year 1997.
Glenayre Technologies Inc. (Nasdaq:GEMS) is a worldwide provider of telecommunications infrastructure products and
systems serving the paging, cellular, PCS, telco, voice processing, and point-to-point wireless service provider markets.
Glenayre's net sales exceeded $390 million in 1996 and the company employs approximately 2,100 people worldwide.
Additional information about Glenayre is available on the company's Web site at: glenayre.com.
The Private Securities Litigation Reform Act of 1995 contains a safe- harbor provision for forward-looking statements. This
document contains forward-looking statements and assumptions. Future events could differ materially from the forecasts and
assumptions referenced in this document, as described in the cautionary statements included in Glenayre's most recent Form
10-Q filed with the Securities and Exchange Commission.
ReFLEX25, ReFLEX50 and InFLEXion are registered trademarks of Motorola.
MVP is a registered trademark of Glenayre.
SOURCE: Glenayre Technologies Inc.
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