Exfo broadens its testing reach with Astellia acquisition

The mobile test and measurement industry usually sees a big uptick from a new generation of technology, since its players lead the way in helping operators assess the new platforms. This has prompted the latest acquisition in a sector which has seen a lot of consolidation in recent years, as Exfo prepares to enhance its position in mobile testing by acquiring Astellia, adding analytics to its 5G-ready proposition.

Exfo will first take a 33% stake in French-based Astellia and then launch a voluntary takeover bid of the company, with a total value of about €25.9m. If successful, it will move into the market for performance analysis of commercial systems, expanding from its current role mainly in pre-commercial test and measurement.

Astellia describes itself as providing network and subscriber intelligence enabling MNOs to improve service quality and maximize efficiency. It focuses on automated optimization, geolocation insights and big data analytics to support operator decisions.

“This investment in Astellia is in line with our strategy to increase our critical mass and our client base, and to expand our addressable market in the global analytics and service assurance industry,” said Germain Lamonde, executive chairman of Exfo’s board.
“If our public tender offer is successful, we’ll be able to combine Astellia’s solutions and services with those of Exfo and become a world leader in the network monitoring and analytics sector and target growth opportunities such as network virtualization, 5G and the Internet of Things.”

Under the terms of the agreement, Exfo will purchase the company from the three Astellia founders and Isatis Capital, subject to approval by French foreign investment authorities. Astellia’s board has already approved the deal, which is expected to close in late 2017.

The last acquisition in the testing sector took place in February, when Keysight bought Ixia. Keysight, which spun out of Agilent in 2014, paid $1.6bn in cash for its prey. The latter had itself acquired a product line, the N2X, from Agilent, back in 2009. As a  telecoms specialist it is boosting that side of the more generalized Keysight’s business. Keysight also acquired another specialized wireless testing firm, Anite, in 2015. The combined portfolio of the two firms covers testing from the edge of the network in devices and the IoT, to the IP core and cloud data center, indicating how testing firms need to broaden their portfolios, as Exfo has also recognized.