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Monday, August 07, 2006

Bidding War Over Andrew Corporation

Andrew Corporation (ANDW) has received a higher bid this morning over its prior bid from ADC Telecommunications (ADCT). Andrew was already in a takeover agreement from May 31, 2006, but this morning CommScope (CTV) has stepped in and made a new offer is a $9.50 cash bid. Part of the problem with the prior offer is that the shares are actually now lower as many names in the sector have slid and seen eroding share prices.

Andrew (ANDW) is up 18% pre-market at $9.32 after closing at $7.89 Friday. In response to this, ADC (ADCT) is trading up 5% at $12.86 per-market.

When this ADCT offer was first made, the shares of ANDW had traded almost as high as $11.00 and have traded as low as $7.08 since that time.

According to the company:

"We believe that our all-cash proposal is extremely compelling for Andrew shareholders and provides Andrew shareholders superior value over that contemplated by the existing merger agreement with ADC," said Frank Drendel, CommScope's Chairman and Chief Executive Officer. "Under our proposal, Andrew shareholders will receive a substantial cash premium for their shares without the significant uncertainties inherent in ADC's proposed stock-for-stock merger transaction. We believe that Andrew's Board of Directors and shareholders will find our all-cash proposal superior to the ADC transaction. For CommScope shareholders, we believe this transaction represents a unique opportunity to become even more competitive and profitable, with an even stronger and more diverse revenue stream. We look forward to Andrew's Board and management team carefully considering our all-cash proposal and moving quickly with them towards a definitive merger agreement.

"The combination of Andrew and CommScope is a logical step in the continued growth and development of CommScope," continued Mr. Drendel. "The combination will create a global leader in providing solutions for the 'last mile' of communications networks. The 'last mile' provides the final link between broadband and content-rich services and the end-user, including homes, business enterprises and wireless customers. Andrew is an excellent fit with our portfolio, and provides us with the opportunity to build upon CommScope's innovative carrier technologies and Andrew's strong global wireless channel and brand. The transaction will also expand our global footprint and our worldwide growth opportunities by combining CommScope's leading global channel in enterprise applications with Andrew's in-building wireless solutions."

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