DZS (Nasdaq: DZSI), a global leader of access, optical and
AI-driven cloud software solutions, today announced it has secured
$25 million in debt and equity funding and signed a definitive
agreement to divest its Asia business, creating a broadband
networking and AI-driven software pure play focused on the
Americas, Europe, Middle East, and Africa (EMEA), and Australia/New
Zealand (ANZ) regions.
On Jan. 5, 2024, DZS signed a definitive agreement to sell its
Asia operations to Korea-based DASAN Networks Inc. (DNI), a
significant stockholder of DZS, for $48 million, consisting of $5
million of cash and the elimination of approximately $43 million of
debt. The sale is expected to close in February 2024, subject to
regulatory approvals and other customary closing conditions.
In addition, DZS has secured $25 million of cash, consisting of
a $15 million, 3-year term note with EdgeCo, LLC (EdgeCo), in
connection with EdgeCo also receiving 6.1 million of warrants at an
exercise price of $1.84, and $10 million as part of a private
placement of DZS common stock with a Korean limited partnership
controlled by Invites Ventures Co. (Invites Ventures), of which
affiliates of DNI are the limited partners.
The divestiture allows DZS to focus on the Americas, EMEA and
ANZ regions that are strategically aligned with the technology and
acquisition investments made over the past several years,
specifically the company’s category-defining Velocity access edge
optical line terminal (OLT) portfolio; Saber optical edge
reconfigurable optical add-drop multiplexer (ROADM) dense
wavelength-division multiplexing (DWDM) platform resulting from its
Optelian acquisition in 2021; and its advanced AI-driven
orchestration, automation, slicing, network assurance and WiFi
management software portfolio resulting from the company’s
acquisitions of RIFT and ASSIA software and R&D assets in 2021
and 2022 respectively.
This divestiture of its Asia Business aligns with the company’s
vision, strategy and growth pillars unveiled in October of 2020,
specifically 1) Fiber-to-the-X (FTTX) broadband investment cycle
fueled by over $100 billion in government stimulus funds, 2) growth
spanning North America and Europe, 3) geopolitical security related
cap-and-grow opportunities, 4) software-defined networking (SDN),
and 5) 5G mobile transport adoption.
Over the past two years and during the second half of 2023, DZS
has secured several new marquee customers inclusive of multi-year
FTTX networking and 5G cloud software contracts which the company
anticipates will fuel valuable growth over the next several years.
The $30 million of incremental working capital will strengthen DZS’
balance sheet, supporting a robust pipeline, numerous field trials
and the timing of billions of government stimulus funds anticipated
to begin deployment in 2024.
“The $30 million of incremental working capital and the
divestiture of our Asia business is expected to enable us to focus
on our momentum with fiber-forward service providers across the
Americas, EMEA and ANZ,” said Charlie Vogt, President and CEO, DZS.
“The sale of our Asia business additionally enables us to
transition to a more software-centric, AI-driven business model.
Service providers in our new focused regions are embracing our
open, standards-based, software-defined solutions and are
increasingly transitioning away from Chinese vendors due to
security concerns. During the second half of 2023, we secured
several new multi-year, FTTX and 5G projects spanning our new
Velocity V6 Access Edge, Saber 4400 Optical Edge, and AI-driven 5G
slicing, automation and network orchestration software platforms.
Our refined geographic focus allows us to scale common platforms
across these regions and aligns with the numerous government
stimulus initiatives designed to bring high speed digital
communications services to unserved and underserved communities
that are underway across these markets and expected to ramp during
the next 12-18 months. We expect that our focus now on the
Americas, EMEA and ANZ regions, with disruptive and differentiated
access and optical networking solutions and a higher percentage of
cloud-controlled software, will enable us to achieve improved gross
margins by the end of 2024.”
Vogt concluded, “Although 2023 was a reset across our industry
as service providers worked through post-pandemic supply and
inventory challenges, DZS will enter 2024 right-sized,
recapitalized and better positioned for long-term sustainable
growth focusing on higher margin software-defined solutions and
markets. While the past six months have been challenging due to our
previously announced restatement process, as well as a global
supply chain reset, our leadership team and financial advisors have
worked very well together securing $25 million of working capital
and through the proposed sale of our Asia business, an additional
$5 million in cash together with the elimination of approximately
$43 million of debt. Our employees are committed to the vision and
strategy unveiled in 2020 and remain focused on our customers and
partners as we enter 2024.”
DZS will host a conference call at 8:30 a.m. ET on Monday,
January 8, 2024. Please join the conference call at least five
minutes prior to the start time to ensure you are admitted prior to
management’s prepared remarks. A live broadcast and replay of the
audio webcast will be available
at https://investor.dzsi.com.
About DZS Inc.
DZS Inc. (Nasdaq: DZSI) is a global leader of access,
optical and AI-driven cloud software solutions.
DZS, the DZS logo, and all DZS product names are trademarks of
DZS Inc. Other brand and product names are trademarks of their
respective holders. Specifications, products, and/or product names
are all subject to change.
This press release contains forward-looking statements regarding
future events and our future results that are subject to the safe
harbors created under the Private Securities Litigation Reform Act
of 1995. These statements reflect the beliefs and assumptions of
the Company’s management as of the date hereof. Words such as
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,”
“forecast,” “goal,” “intend,” “may,” “plan,” “project,” “seek,”
“should,” “target,” “will,” “would,” variations of such words, and
similar expressions are intended to identify forward-looking
statements. Such statements include, but are not limited to,
statements about the consummation and timing of the Asia business
divestiture, the anticipated benefits of, and opportunities from,
the divestiture, including the impact to the Company’s balance
sheet, operations and financial results. Readers are cautioned that
these forward-looking statements are only predictions and are
subject to risks, uncertainties and assumptions that are difficult
to predict. The Company’s actual results could differ materially
and adversely from those expressed in or contemplated by the
forward-looking statements. Factors that could cause actual results
to differ include, but are not limited to, those risk factors
contained in the Company’s SEC filings available
at www.sec.gov, including without limitation, the Company’s
annual report on Form 10-K, quarterly reports on Form 10-Q and
subsequent filings. In addition, additional or unforeseen affects
from the COVID-19 pandemic and the global economic climate may give
rise to or amplify many of these risks. Readers are cautioned not
to place undue reliance on any forward-looking statements, which
speak only as of the date on which they are made. DZS undertakes no
obligation to update or revise any forward-looking statements for
any reason.
For further information see: www.DZSi.com.DZS on Twitter:
https://twitter.com/dzs_innovationDZS on LinkedIn:
https://www.linkedin.com/company/DZSi/
Investor Inquiries:Ted Moreau, Vice President,
Investor RelationsEmail: IR@dzsi.com
DZS (NASDAQ:DZSI)
過去 株価チャート
から 5 2024 まで 6 2024
DZS (NASDAQ:DZSI)
過去 株価チャート
から 6 2023 まで 6 2024