Sandvine and Procera announce network intelligence merger

Canada’s Sandvine Corporation will be merged with US Procera Networks to create a $700 million network intelligence player.

Procera was acquired by private equity firm Francisco Partners for $240 million back in 2015, but a couple of months ago Sandvine announced it was going to be acquired by Vector Capital for CA$483 million (US$383 million). This announcement seems to amount to a gazumping by Francisco as the Vector move was only terminated today, with a termination payment of CA$17 million. Francisco is paying CA$562 million (US$446 million) for the opportunity to bring the two companies together.

“We are excited to bring together two great companies and teams in the combination of Procera and Sandvine,” said Andrew Kowal, Partner at Francisco Partners. “The combined company will serve over 400 communications service provider customers, with over 1 billion subscribers in more than 100 countries, as well as over 500 enterprise customers and more than 100 OEM and channel partners.”

“This is a very exciting next step for Sandvine and Procera. As technologies and networks continue to evolve, I firmly believe that the combination of Sandvine and Procera creates the premier provider in our markets — with the scale and innovation needed to address our customers’ opportunities to build more intelligent networks,” said Dave Caputo, Sandvine’s President and CEO, who be non-exec Chairman of the new company.

“Sandvine has done a tremendous job becoming a leader in its market,” said Lyndon Cantor, CEO of Procera, who will also be CEO of the combined company. “Along with the rest of the Procera team, we look forward to bringing the best of both companies together to accelerate our strategy as the preeminent provider in the emerging Network Intelligence market.”

The combined company, which will be called Sandvine, will continue to focus on network intelligence. There was no extra insight into strategy, product direction, etc in an announcement that mainly devoted itself to the kind of arcane legalese M&A lawyers seem to get excited by. It would be surprising if such a niche merger attracted the attention of antitrust authorities.

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