Alvarion may have a suitor but faces Nasdaq delisting

What is left of former WiMAX vendor Alvarion, which is hobbled by $24 million in debt, is reportedly being eyed for takeover by another Israeli company called Sigma Wave.

According to Globes, Sigma Wave is the largest shareholder in SuperCom, a developer of electronic ID (EID) and RFID devices that has a market cap of $28 million. Sigma Wave was reportedly eyeing Alvarion before a Tel Aviv District Court appointed a receiver for the struggling vendor, which sold its WiMAX business earlier this year and is now developing Wi-Fi gear. Sigma Wave is reportedly still interested in acquiring Alvarion out of receivership.

Sigma Wave could acquire Alvarion directly or via SuperCom. SuperCom expects to conduct a secondary issue of stock to raise $20 million after August, said Globes.

SuperCom said in early July that it would use proceeds from the offering for "the possible acquisition of contracts, selected complimentary intellectual property, and software packages from key players in the e-ID and electronic monitoring markets; develop a local presence in Europe and the Far East; and for working capital needs and other general corporate purposes."

Meanwhile, struggling Alvarion received more bad news in the form of a letter from Nasdaq's Listing Qualifications Department indicating the company's ordinary shares are subject to delisting. Nasdaq's letter cited concerns stemming from the appointment of a receiver to enforce liens registered against the company as well as the residual equity interest of the company's shareholders.

Alvarion said it will request a hearing before the Nasdaq Listing Qualifications Panel to review the decision and will remain listed on Nasdaq pending the outcome of the hearing.

A 30-day operating plan for Alvarion submitted by the company's receiver, Yoav Kfir, to Tel Aviv District Court Judge Eitan Orenstin was approved. Kfir reported that Alvarion apparently owes $24 million to various entities, though the information is incomplete. Most of the debt, $17.5 million, is owed to suppliers. Silicon Valley Bank, which initiated the receivership proceedings, is owed $3.3 million

Telrad Networks, which bought Alvarion's WiMAX business in May for an amount that could reach $12 million, claims it is owed $5 million by Alvarion. Telrad alleges Alvarion held back money it received from third parties that was connected to assets sold to Telrad.

Alvarion once employed 1,100 people but only has 98 employees currently at its Rosh Ha'Ayin, Israel, headquarters. Another 39 employees in Yokne'am, Israel, joined the company as a result of the acquisition of Wi-Fi gear vendor Wavion Networks in 2011. The landlord of the Yokne'am property has threatened to evict the company by Aug. 1 over non-payment of a utility bill, said Globes.

The recently approved operating plan calls for the employment of 55 people through Aug. 23.

For more:
- see this Globes article and this article
- see this Alvarion release
- see this Reuters article

Related articles:
All Alvarion employees given layoff notices
Alvarion sells WiMAX business to Telrad for $6.1M
WiMAX Forum president says an Alvarion exit could be positive