UTStarcom Inc.’s infrastructure business has gone private. The company, which also makes a range of cellphones, has sold its mobile solutions business unit to private equity firm OpenGate Capital for an undisclosed sum.
UTStarcom’s stock was up slightly on the news to around $5.62 per share.
The new company, Star Solutions, will continue to work with UTStarcom as a device vendor as it takes over the latter’s IP-based CDMA business. UTStarcom said the move is in line with a plan it announced late last year to re-double its focus on IP-based technologies such as IPTV, next generation networks and broadband. The company cut about 700 jobs at the time as well.
The sale comes little more than a month after two of the company’s top executives, CEO Hong Liang Lu and former CFO Michael Sophie, were fined a combined $175,000 by the U.S. Securities and Exchange Commission to settle allegations of false financial reporting.
Today, the company also announced that Lu would be replaced by Peter Blackmore as the company’s CEO, beginning next month. Lu will become the company’s executive chairman of the board and remain a full-time employee as an external “ambassador of UTStarcom with particular emphasis on Asia and will analyze and recommend new business models and technology strategies,” the company said.
Blackmore, who previously worked for Unisys and the Hewlett-Packard Co., joined UTStarcom last year.
UTStarcom offloads infrastructure biz
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