Advised Kreatel Communications, a developer of innovative Internet Protocol (IPTV) digital set-tops, on its sale to Motorola
Jan 2006
acquired by
$106 million
  • Sector: Industrial Tech; Systems & Deep Tech
  • Deal Type: Strategic Deals; Venture Capital Exits
  • Engagement type: Sellside
  • Size: $106 million
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We are pleased to announce that Arma Partners has acted as exclusive financial advisor to Kreatel Communications AB, of Linköping, Sweden, in its proposed acquisition by Motorola, Inc. (NYSE: MOT) , which was announced on 17 January, 2006. The transaction marks the thirteenth announced technology M&A transaction on which Arma Partners has advised since the firm was founded in 2003.

Kreatel (www.kreatel.com) is a leader in developing and providing innovative Internet Protocol based digital set-top platforms (IPTV) to telecoms service providers. Its customers include Telefonica, KPN and TeliaSonera. The transaction illustrates the continuing vitality and worldwide interest in the provisioning of IPTV services over broadband networks and its associated technologies. It also represents another example of the consolidation trend in the broader telecom equipment sector, which we expect to be a continuing theme of the M&A market for the remainder of 2006.

Kreatel is owned by its management and institutional shareholders, including ABN AMRO Capital, SEB Företagsinvest, Innovationskapital and Bure Equity. Terms of the transaction were not disclosed, although Bure Equity, listed on the Stockholm Exchange, announced that it expected to receive approx SEK40m net (approx. $5.2m) for its 4.9% holding.

– Kreatel Communications AB is a leading developer of innovative Internet Protocol (IPTV) based digital set-tops, headquartered in Linkoping, Sweden

– Kreatel’s Linux-based solution extends into the application and middleware layers, allowing it to be used with a broad set of middleware solutions

– Customer base includes such major service providers as Telefonica, TeliaSonera, and KPN

– Motorola (NASDAQ: MOT) is a Fortune 100 global communications leader that provides mobility products and solutions across broadband, embedded systems and wireless networks

– Operating through the three primary business units of Enterprise Mobility Solutions, Home & Networks
Mobility and Mobile Devices, Motorola achieved sales of $35.2bn in 2005

– Offices in America, Asia, Middle East, Africa and Europe and 66,000 employees

– Combining Motorola and Kreatel’s strengths is attractive to green field video networks around the world and provides a critical solution as service providers evolve their video networks in the future

– Kreatel brings in-depth experience developing and delivering IPTV set-top software and hardware solutions to European telecom operators and ISPs

– Through Kreatel, Motorola gains immediate European Telco TV presence and traction with a number of large European customers who have previously deployed Kreatel’s set-tops

– Arma Partners began advising the board and shareholders of Kreatel (mainly venture capital and private equity investors), on long term value options in 2004

– Once Kreatel achieved significant momentum with key European telecoms customers, Arma Partners advised that the time was right to explore strategic options

– Arma Partners took the company to meet key US “aggregators” in the sector, in the fall of 2005 and orchestrated the successful sale to Motorola, following interest expressed by a number of parties