Powerwave Technologies, Inc. (NASDAQ:PWAV), and Shenzhen Tatfook
Technology Co. Ltd. today announced that they have entered into a
definitive agreement under which Tatfook will acquire selected assets of
Powerwave’s China manufacturing facility and will provide Powerwave with
a long-term manufacturing and supply agreement. Tatfook will purchase
certain assets from Filtronic (Suzhou) Telecommunication Products Co.
Ltd, which is the subsidiary of Powerwave that owns and operates
Powerwave’s China manufacturing operation, for US$12.5 million which
will be fully paid on closing. The transaction is expected to close
during the current quarter, and includes the assumption of selected
facility leases in Suzhou, the purchase of certain equipment, inventory
and offers of employment to employees located in Powerwave’s China
manufacturing operations.
Upon closing of this transaction, Powerwave will license Tatfook to
manufacture and sell selected antenna and tower mounted amplifier
products within the China market under a license and manufacturing
agreement. Tatfook will pay an upfront license fee of US$5 million under
the license and manufacturing agreement as well as ongoing royalty fees
on future product sales. Also upon closing of the transaction, Tatfook
will enter into a strategic supply agreement with Powerwave where
Powerwave can benefit from Tatfook’s low cost structure and strategic
manufacturing capabilities.
Powerwave is retaining all of its industry leading antenna capabilities,
as well as advanced capabilities that are crucial to providing leading
edge filtering solutions to the global wireless market, including
customer relationships, product innovation and research and development,
global customer support and customer contracts.
“We believe our strategic relationship with Tatfook will enable us to
leverage both Tatfook’s strategic outsourcing capabilities as well as
their unique sales capabilities within the China market,” stated Ronald
J. Buschur, Powerwave’s President and Chief Executive Officer.