Terabeam Wireless announced today it has signed an agreement to purchase all of Proxim Corp.’s assets for $28 million. Terabeam was the highest bidder in Proxim’s court-approved auction held in connection with the company’s Chapter 11 bankruptcy filing announced in June.
Proxim has abandoned a mid-June $21 million agreement with Moseley Associates, while its new agreement with Terabeam is expected to be approved by the U.S. Bankruptcy Court for the District of Delaware by July 29. Under the agreement, Terabeam will pay $28 million for Proxim’s assets and is obligated to provide debtor-in-possession financing, which eventually will be deducted from the purchase price. Also, as was previously stated in Proxim’s public filings with the Securities and Exchange Commission, no proceeds from the sale of assets will be given to Proxim stockholders due to the company’s creditor obligations.
Terabeam said it will move its headquarters to Proxim’s San Jose, Calif., facility and will continue to drive the Proxim brands, supporting its ongoing sales, customers, channel partners, employees and suppliers. Terabeam is currently headquartered in Sunnyvale, Calif.
“This is a great opportunity for Terabeam, as well as for our respective customers and employees,” said Robert Fitzgerald, chief executive of Terabeam. “We will be able to offer best-of-breed wireless solutions in virtually every arena, from Wi-Fi through wireless Gigabit Ethernet. We have always been very impressed by Proxim’s distribution system, and we look forward to expanding on their strong channel partnerships. We look forward to bringing together two energetic organizations and believe that we can accelerate product development and our position in the market while maintaining the financial discipline to achieve profitable operations.”
“We view this transaction as an opportunity to team with a company with an aggressive and focused growth strategy,” said Kevin Duffy, president and chief executive of Proxim. “With this agreement, we combine our talent and technology to gain time-to-market advantage, exceed the expectations and needs of our combined customers, and grow the overall adoption of wireless networking.”
Proxim received notice in early June from the Nasdaq Stock Market Inc. that it had failed to meet minimum bid requirements and would be delisted.
In April 2004, Terabeam merged with YDI Wireless Inc. and became a wholly owned subsidiary of YDI.
