This article is more than 1 year old
Moseley mops up Proxim’s assets
Once a top three wireless LAN player and with a peak share price of $250, Proxim filed for Chapter 11 bankruptcy protection last week with its shares down at 32 cents, less than three per cent share of the Wi-Fi market, and facing delisting from the Nasdaq exchange. Its first action was to sell “substantially all assets” to Moseley Associates, a Californian holding company that is assembling an interesting portfolio of wireless companies.
Proxim appeared to be expert at spotting key industry trends, jumping early into enterprise WLans; snapping up a broadband wireless player, Western Multiplex, before the WiMAX bubble inflated; making a strategic alliance with Motorola and Avaya for wireless VoIP just before that technology hit all the headlines.
But the company struggled to keep its position against a dominant Cisco, a host of start-ups and spiralling prices in the WLAN space, and fumbled the move towards switches; while despite an important reference platform alliance with Intel on the WiMAX front, it managed the merger and the shift towards broadband wireless badly, suffering from product delays and structural inefficiencies.
Once it lost a $22.75m dollar patent lawsuit to rival Symbol last year, the writing was on the wall and it was estimated that, although the company was seeking new funding, it would have needed to raise $100m to be debt-free.
Moseley will pay $21m for its new subsidiary and will provide $6.2m of bridge financing until the deal is closed. Proxim stockholders are not expected to see proceeds of the sale, according to the Proxim statement, although it owed investors about $80m in the event of a material asset sale. The Moseley deal will need to be approved by the bankruptcy court.
Assuming it goes through, Moseley expects to continue to support and develop Proxim’s key ranges, the Orinoco WLAN and Tsunami pre-WiMAX lines. These will fit well into its wireless portfolio, which it has been expanding aggressively through acquisition.
Many wireless vendors are looking to create an end-to end platform from point-to-point backhaul technologies to consumer access, and Moseley’s portfolio now offers this, with a particular expertise in the broadcasting market.
Moseley had revenues of over $90m pre-tax earnings of $20m last year, and about 300 employees (excluding Proxim), about 100 of these engineers. Its products range from 9.6Kbps to 311Mbps in performance in spectrum bands from 200MHz to 38Ghz and it targets broadcasters (its original market), service providers and large enterprises. In the WiMAX market, it owns Axxcelera, which recently announced its ExcelMAX 802.16 products and also specializes in point-to-point backhaul solutions.
It is not clear how these products will be integrated with, or differentiated from, those of its new stablemate. Other Moseley acquisitions since 2000 include Microwave Data Systems, which makes industrial broadband wireless solutions for applications like public safety; Moseley Broadcast; and CarrierComm, which provides the backhaul aspect of the mix, with point-to-point products running in bands from 3.5GHz to 38GHz.
Earlier this month, Proxim was notified by the Nasdaq stock exchange that, for the 30 consecutive trading days preceding the date of the letter on June 3, the bid price of the company's common stock had closed below the $1.00 per share minimum required for continued inclusion on the Nasdaq National Market and that it had until November 30 to regain the minimum bid price, or face delisting.
Copyright © 2005, Wireless Watch
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