Update: CommScope competes for Andrew

CommScope has launched a bid to acquire Andrew Corp., which earlier this year had agreed to merge with ADC Telecommunications. CommScope's competing cash bid is valued at $9.50 per share, or $1.7 billion, much higher than the $6.97-per-share premium that Andrew shareholders would have received under ADC's stock-based proposal, according to CommScope.

Those prices are based on company values at market closing last Friday, at which time Andrew's stock was priced at $7.89 and ADC's was at $12.22. CommScope sent a letter dated today to Andrew President and CEO Ralph Faison describing the competing bid, and asking for a response to that offer by 5 p.m. Eastern time on this Friday, Aug. 11.

If its bid is accepted, CommScope would look to close the deal by early 2007. "We believe that our all-cash proposal is extremely compelling for Andrew shareholders and provides Andrew shareholders superior value over that contemplated by the existing merger agreement with ADC," said Frank Drendel, CommScope’s chairman and CEO, in a statement. "Under our proposal, Andrew shareholders will receive a substantial cash premium for their shares without the significant uncertainties inherent in ADC’s proposed stock-for-stock merger transaction."

An Andrew spokesman told Telephony that the company “will seriously evaluate” CommScope’s offer, but isn’t issuing any other public statement on the matter for now. The spokesman did not indicate whether or not Andrew would respond by the end of this week.

The merger agreement between ADC and Andrew still requires the approval of both companies’ shareholders, and the Andrew spokesman said dates for those shareholder votes have not yet been scheduled. As of this writing, ADC had not responded to a call seeking comment.

Since the companies announced their merger proposal on May 31, the pending deal has come under fire from some analysts who felt the match could introduce financial performance hurdles for ADC.

In early July, ADC and Andrew were informed by the Federal Trade Commission that the FTC had concluded its review of the proposed and granted early termination of the Hart-Scott-Rodino waiting period.

Similar to ADC, CommScope, based in Hickory, N.C., is a supplier of last-mile cable and connectivity solutions. ADC is headquartered in Eden Prairie, Minn., and Andrew is located in Westchester, Ill.