CommScope Soared: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Before sunrise this morning, CommScope (NYSE: CTV  ) confirmed it was in talks to be taken private by The Carlyle Group in a buyout priced at $31.50 per share. The stock surged more than 30% on the news.

So what: Carlyle has been busy in recent months. In July, it agreed to purchase vitamin supplier NBTY for $3.8 billion. So while no agreement has been reached as of this writing, given Carlyle's history, it's reasonable to expect one.

Now what: In announcing the negotiations, CommScope may be trying to entice a white knight into making a better offer. Trouble is, competitors such as General Cable (NYSE: BGC  ) and Powerwave Technologies (Nasdaq: PWAV  ) aren't nearly as well capitalized as Carlyle is, and customers such as Alcatel-Lucent (NYSE: ALU  ) and Comcast (Nasdaq: CMCSA  ) already have too much debt.

Interested in more info on CommScope? Add it to your watchlist here by clicking here.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He didn't own shares in any of the companies mentioned in this article at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. You can also get his insights delivered directly to your RSS reader. The Motley Fool is also on Twitter as @TheMotleyFool. Its disclosure policy is at least 10% better than other disclosure policies.


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