Hytera Communications completes acquisition of Sepura

China-based Hytera Communications today announced that it completed the acquisition of the Sepura Group, ending the months-long saga for the $92 million all-cash purchase of the United Kingdom (UK)-based provider of TETRA products and solutions.

Completion of the deal—including the delisting of Sepura from the London Stock Exchange—was executed as scheduled after regulators in Spain, Germany and the UK granted approvals for the deal in recent months. Sepura has the second-largest market share in European public security, and the acquisition will add about 700 employees to the Hytera organization, according to a Hytera press release.

“The PMR [professional mobile radio] communications industry is seeing rapid evolution, and Hytera leads in incorporating new technologies and attractive features that deliver more effective solutions for our customers,” Qingzhou Chen, Hytera Communications’ founder, chairman and president, said in a prepared statement. “Adding the Sepura Group complements our strengths in technological innovation, especially in TETRA, along with adding sophisticated engineering talent and an experienced operating team, and enhances our channel partnerships around the world.”

Hytera’s $92 million purchase of Sepura was completed just days before the two-year anniversary of Sepura acquiring Teltronic—a company that does business in the United States under the PowerTrunk brand—for $139.6 million in a deal that closed in May 2015.

However, Sepura struggled throughout 2016, with the company’s stock price dropping by 90% amid multiple profit warnings, much of which company officials attributed to key contracts being delayed by customers for budgetary reasons.

Under the terms of the deal, Sepura stockholders will receive 20 pence for each share of Sepura stock, according to information on the Sepura website.

Hytera and Sepura provided PMR solutions for event-management and public-safety personnel during the 2016 Olympics in Brazil, and Hytera will provide similar solutions next year for the 2018 World Cup in Russia.

“Joining with Hytera gives us access to a broader cross-section of the market, gives our dealers the advantage of a wider range of products and solutions, and provides growth opportunities for our engineers and research and development technicians,” Sepura interim CEO David Barrass said in a prepared statement. “With its growing momentum in the PMR space and some very high-profile opportunities, Hytera is executing a clear strategy as it expands globally. It's a terrific opportunity.”

With more than 7,000 employees, Hytera Communications is the world’s fastest-growing PMR solutions provider and global leader in DMR Tier III trunking, according to a Hytera press release. Last year, Hytera reported 39% growth year-to-year growth, and the company announced its PMR-LTE solution recently at Critical Communications World 2017 in Hong Kong.

“Hytera has tremendous momentum in the marketplace,” Chen said in a prepared statement. “Last year, we became the second-largest PMR communications provider in the world, and we believe there remain excellent prospects for growth in key markets.”

However, Hytera recently has been the subject of controversy, as Motorola Solutions has alleged that Hytera has bolstered its product portfolio by implementing technology that uses patents and trade secrets stolen from Motorola Solutions in 2008 by three engineers who left Motorola Solutions to join Hytera. The case is the subject of court cases in the United States and Germany, as well as an investigation that is being conducted by the U.S. International Trade Commission.