Sierra Wireless has executed a definitive agreement for the sale of its AirCard business to Netgear for $138 million in cash, plus approximately $6.5 million in assumed liabilities as of December 31, 2012.
Sierra Wireless expects to realize net cash proceeds of approximately $100 million from the asset sale, after related taxes, expenses, and funds held in escrow. The transaction is expected to close in March 2013, subject to customary closing conditions.
Under the transaction, Netgear will acquire the assets and operations of the AirCard business, including customer relationships, products, intellectual property, inventory, and fixed assets, and assume certain liabilities, including warranty commitments and other customer obligations. Approximately 160 employees, primarily in sales, marketing, and R&D, will be transferred to Netgear, as well as certain facilities in Carlsbad, CA and Richmond, BC.
Upon completion of the transaction, Sierra Wireless’s retained business will include its AirPrime embedded modules for M2M and Mobile Computing, AirLink intelligent gateways and routers, and AirVantage M2M cloud product lines.
Sierra Wireless intends to use net proceeds from the transaction to continue its acquisition strategy in the M2M market. The company is also exploring alternatives to return a portion of the proceeds to shareholders.