Arris to acquire Pace for $2.1 billion

US video and broadband technology player Arris is acquiring UK set-top-box maker Pace for $2.1 billion, in a bid to not only dominate the STB market but strengthen its cloud content and cable infrastructure operations. Arris will also use the deal to incorporate itself in the UK, presumably for tax purposes.

“Adding Pace’s talent, products and diverse customer base will provide Arris with a large scale entry into the satellite segment, broaden our portfolio and expand our global presence, said Arris chairman and CEO Bob Stanzione. “We expect this merger will enable Arris to increase its speed of innovation. We believe this is a tremendous opportunity for Arris and our customers, employees, shareholders and partners around the world as we collaborate to invent the future.”

“Through a combination of organic development and acquisitions, Pace has grown to be a leading technology solutions provider to the PayTV and Broadband industries serving cable, satellite and telco customers across the globe,” said Pace Chairman Allan Leighton. “Over the last three years, Mike Pulli and the wider Pace team have successfully executed against our strategic plan to develop Pace into a more distinctive, profitable and cash generative company, creating significant value for shareholders.

“The Pace Directors believe that Arris’s offer recognises this value and also gives our shareholders the opportunity to share in the future success of the combined group. We believe this is a great fit for both companies, our employees, customers and trading partners.”

There seems to be a clear eye on the future with this acquisition. While seeking to dominate the STB market alone might justify the move, such products will need to do a lot more in future in order to compete with games consoles and smart TVs as the living room digital hub.