Deals review – April 2015
Thursday 14th May 2015
In partnership with the Business Desk, several of our experts will comment on significant deals every month. For April our digital and technology expert, Graeme Davy, looks at the standout deal of the month, and arguably the year, as Saltaire-based big hitting Set Top Box developer, Pace PLC, is acquired by Arris, a US video and broadband technology company.
Subject to regulatory compliance on both sides of the pond, it is anticipated that Pace will be integrated within the Arris Group by the end of the year. The offer values Pace at £1.4bn.
Established in 1982, Pace was an integral part of the UK pay television revolution, following the introduction of TV satellite broadcasting during the 1980s. Having supplied SKY with set-top boxes during its growth, it was able to capitalise on this experience by entering into similar arrangements with broadcasters in other jurisdictions, and then subsequently in to other growth areas in the pay-tv and broadband industry.
Whilst Pace’s main, but not only strength, lies in satellite, Arris predominantly deals with cable. As a result, I see a clear synergy between the two businesses and the new group will benefit from a wealth of talent currently operating from Pace’s HQ in Saltaire. The acquisition reflects a continued globalisation of the telecommunications sector, with geographical borders no longer being a hindrance to growth. The main providers are looking to increase their knowledge pool and customer base, as well as share resources, with one eye on the future as our home entertainment habits continue to evolve.
Whilst it will be disappointing to see the Pace brand gradually disappear, it is a testament to the quality of the business that has been built from its roots in Yorkshire, and the skills of its workforce, that it has been approached by Arris.
It will be interesting to see how this develops over the next couple of years. Given the general trends in the home hub sector, I expect there to be more deals of this kind in the coming years.
Previous deals reviews: