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On Wednesday, Deutsche Bank (ETR:DBKGn) analyst Robert Sanders revised the price target for Spirent (LON:SPT) Communications Plc (SPT:LN) (OTC: SPNUF) to GBP2.01, a decrease from the previous target of GBP2.50. Despite this adjustment, the firm maintains a Buy rating on the stock. The change in price target comes in the wake of recent developments regarding the company’s business operations and prospective acquisition.
Sanders expressed a high level of confidence that Keysight Technologies (NYSE:KEYS) will successfully acquire Spirent, following the latter’s agreement to sell its high-speed Ethernet (HSE) testing business to Viavi Solutions (NASDAQ:VIAV). This transaction was officially announced on March 3, 2025. He pointed out that the sale of the HSE testing division addresses a significant hurdle that could have impeded Keysight’s bid for Spirent.
The rationale behind the lowered price target is based on the anticipated completion of Keysight’s acquisition of Spirent. Spirent’s CEO had previously noted in mid-2022 that both Spirent and Keysight held approximately 40% of the global HSE testing market share each. With the disposal of Spirent’s HSE business, the competitive concerns regarding the overlap with Keysight’s operations are significantly reduced, given that Keysight’s overlap with Spirent’s remaining businesses is likely to be inconsequential.
Sanders’ valuation adjustment reflects a 19% decrease from the discounted cash flow (DCF)-based fair value estimate of 250 pence per share for Spirent to the offer price of 201.5 pence per share proposed by Keysight. The acquisition process is expected to be finalized by April 30, 2025, as stated in Spirent’s announcement dated December 2, 2025.
Investors and stakeholders of Spirent Communications are now looking forward to the completion of the acquisition process, which is poised to reshape the company’s future operations and market positioning.
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