Spirent Communications plc Signs Definitive Agreement to Acquire Mu Dynamics, Inc.

LONDON, UK – Spirent Communications plc (LSE: SPT) (“Spirent”), a leading communications technology company, announces today that it has entered into a definitive agreement to acquire privately held Mu Dynamics, Inc. (“Mu”), based in Sunnyvale, California, for a cash consideration of $40.0 million. Mu is a security testing pioneer, offering innovative solutions that enable faster, higher quality deployments of Cloud applications and applications-aware networks.

The exponential growth in Cloud-based applications presents critical security risks for equipment manufacturers, service providers, governments, enterprises and end users, requiring them to protect themselves against sophisticated new threats, in order to avoid financial and reputational damage. To address this fast-growing opportunity, Mu developed the industry’s first solution that emulates real application traffic while generating comprehensive security threats, addressing all phases of the development lifecycle. Mu also recently launched Blitz.io, a Cloud-based service that allows enterprise application and website developers to test users’ quality of experience of “Software as a Service” deployments. This capability will enable Spirent to serve the high-growth Cloud-based Application Performance Management market.

“Infrastructure security testing is critical to ensuring confidence in the use of globally-deployed networks and applications,” said Bill Burns, CEO of Spirent. “Mu Dynamics brings additional market-leading expertise in cyber security, usability and application emulation to the Spirent solutions portfolio. Combining Mu’s software-based applications and security testing capabilities with Spirent’s marketleading performance test platforms will enable us to rapidly create best-in-class security test solutions with higher performance and greater scale than any other provider. This acquisition aligns with our strategy of delivering profitable growth through expanding our capabilities in growing and emerging technology markets.”

Spirent is committed to selling, supporting and enhancing Mu’s existing product portfolio. Meaningful additional revenue will be achieved from Spirent’s global reach, especially its strong customer relationships and sales channels in Europe and Asia. Further benefits will be realized through the integration of Mu’s differentiated capabilities into Spirent’s performance test platforms, accelerating the growth rate for Spirent’s networks and applications product line.

“Mu has built a powerful software solution set for our customers, enabling them to test security and application-aware networks.” said Dave Kresse, CEO of Mu Dynamics. “We’re excited that this transaction will accelerate the global deployment of our solutions, and enable their integration into Spirent’s leading performance test solutions.”

Spirent expects to consolidate $9.0 to $10.0 million in revenue post-acquisition in 2012, with a positive return on sales. For the first full year post-acquisition in 2013, revenues are expected to be in the range of $17.0 to $19.0 million operating at Spirent’s average return on sales, resulting in a positive enhancement to earnings and achieving an attractive return on investment, in line with Spirent’s objectives.

The transaction is subject to customary closing conditions and is expected to complete on or about 23 April 2012.

About Spirent Communications plc
Spirent Communications plc is a global leader in test and measurement inspiring innovation within development labs, communication networks and IT organizations. We enable today’s communication ecosystem as well as tomorrow’s emerging enterprises to deploy life-enriching communications networks, devices, services and applications. The Systems group develops power control systems for electrical vehicles in the mobility and industrial markets. Spirent Communications’ sales to the United States government are made through Spirent Federal Systems Inc. Further information about Spirent Communications plc can be found at www.spirent.com

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