The wireless distributor space just became a little bit smaller. Private equity firm Lee Equity Partners and investment firm Twin Point Capital, which owns distributor Alliance Corp., joined forces with distributor GetWireless to acquire Tessco in an all-cash deal valued at approximately $161.4 million.
Nearly every facet of the wireless industry has been impacted by consolidation so it’s not surprising that the distributor space is also merging together. Besides consolidation among wireless operators, the industry has also seen big wireless dealers consolidating such as the April 2022 acquisition of GoWireless by Victra.
Investors reactively positively to the acquisition with Tessco stock jumping 86.8% in mid-day trading to $8.78 per share.
The acquisition will allow Tessco to broaden its footprint and product offering by combining with Alliance and GetWireless. Tessco, however, will keep its existing facilities in Hunt Valley and Timonium, Maryland and also in Reno, Nevada.
Tessco, which has been a wireless distributor for more than 40 years, works with wireless carriers, tower owners, equipment manufacturers, public safety organizations and enterprise and government customers to distribute all types of wireless infrastructure gear including antennas, base stations, access points, backhaul, distributed access systems (DAS), small cells, power systems and more. During the company’s most recent quarter, fiscal Q3, it reported revenues of $114.9 million with a net income of $0.4 million.
Alliance distributes distributed access systems (DAS), antenna systems, power systems, test equipment and tower and infrastructure equipment and GetWireless specializes in cellular modules, modems, gateways and boosters, which are primarily used for the Internet of Things. GetWireless also has a wide network of value-added resellers, integrators and OEM partners that it works with across different vertical markets.
Tessco President and CEO Sandip Mukerjee said in a statement: “Our customers will benefit from a greater breadth of products and service options as we team with two companies that are true leaders in serving the wireless industry.”
Tessco’s board of directors unanimously approved the deal, which is expected to close in the third quarter.