Private equity firms buy Airvana for $530 million

AP News
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Posted: Dec 18, 2009 10:33 AM

Airvana Inc. said Friday that it has agreed to be acquired by private equity firms in a transaction the maker of mobile broadband networking products valued at $530 million.

The buyer is 72 Mobile Holdings LLC, a newly formed company to be owned by S.A.C. Private Capital Group LLC, GSO Capital Partners LP, Sankaty Advisors LLC and ZelnickMedia.

Shareholders of Airvana will get $7.65 in cash for each share they own, which represents a premium of 23 percent over the company's closing stock price on Thursday. The deal is expected to close in the first quarter.

Several executives, including President and CEO Randy Battat and founders Vedat Eyuboglu and Sanjeev Verma, will exchange some of their shares for an ownership interest in the acquiring company.

Merle Gilmore, former President of Motorola's Communications Enterprise, will be the new company's chairman.

Airvana makes products such as femtocells, which are routers placed inside homes and buildings to boost cell phone reception. Shares of the Chelmsford, Mass., company were up $1.28, or 20 percent, to $7.52 in morning trading. The stock earlier traded as high as $7.58, eclipsing a previous year high of $7.10 set in October.