Microsoft deal values 5G software maker Affirmed Networks at $1.35 billion | HT Tech

Microsoft deal values 5G software maker Affirmed Networks at $1.35 billion

Affirmed Networks also held talks with Samsung Electronics before its deal with Microsoft came together, one of the people said.

By: BLOOMBERG
| Updated on: Mar 28 2020, 20:46 IST
Affirmed Networks also held talks with Samsung Electronics before its deal with Microsoft came together, one of the people said.
Affirmed Networks also held talks with Samsung Electronics before its deal with Microsoft came together, one of the people said.

Microsoft Corp.'s agreement to acquire 5G software maker Affirmed Networks Inc. valued the company at about $1.35 billion, according to people familiar with the matter.

Microsoft announced the deal on Thursday without disclosing financial details.

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Microsoft already serves telecom customers and struck an agreement with AT&T Inc. last year with the aim of moving more the carrier's network to its platform. Microsoft has been building its cloud computing operations through acquisitions. In 2018, it bought privately held GitHub for $7.5 billion.

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Affirmed Networks also held talks with Samsung Electronics before its deal with Microsoft came together, one of the people said.

Pete Wootton, a spokesman for Microsoft, declined to comment on the price. A representative for Affirmed Networks also declined to comment. Samsung didn't respond to a request for comment.

Microsoft shares fell 4.1% Friday to close at $149.70.

The introduction of 5G is just starting, with test projects by carriers such as AT&T generally limited to select big cities. Nationwide U.S. coverage may take years. But tech giants and telecom industry incumbents have been angling for a slice of the market for edge computing and going after big corporate customers. The White House has made 5G a linchpin of its tech policy, particularly as it tries to suppress the global expansion of China's Huawei Technologies Co.

The networking industry is transitioning away from expensive fixed purpose machines that take care of specific parts of the job of managing the flow of data to software that resides in remote data centers. The aim is to make the things cheaper and more flexible.

Affirmed Networks helps build virtual networks for telecom customers using 5G technology. It was founded in 2010 and had raised about $240 million in funding, according to Pitchbook Data. It raised financing just last month at a $1.35 billion valuation, people familiar with the matter said.

Affirmed Networks said on Thursday that it was replacing its chief executive officer with one of its founders, Anand Krishnamurthy.

Affirmed Networks, based in Acton, Massachusetts, is backed by investors including Qualcomm Ventures and Centerview Capital Technology Management, the venture arm of investment bank Centerview Partners, as well as by Lightspeed Management, CRV and Bessemer Venture Partners.

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First Published Date: 28 Mar, 20:32 IST
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