Harmonic’s Cable Access portfolio includes optical transmitters, amplifiers, receivers and nodes. The business unit generated $52.9 million of net revenue with gross margin of approximately 30 percent in the 2012 calendar year. Harmonic expects that the sale of the business will be neutral to diluted earnings per share for 2013, excluding the impact of the share repurchase program.

   The company said its strategic decision to divest its Cable Access business was due to its increasing commitment to its Video Production and Playout, Video Processing, and Cable Edge product lines, with which it looks to build its market share. Harmonic, however, admitted that is not the market leader in its Cable Access product area, and that there was limited strategic synergy between Cable Access and its other higher growth product lines. 

   Harmonic President and CEO Patrick Harshman said he was pleased to complete the sale with Aurora Networks because of its scale, strategic focus and its longstanding relationship with its customers in the Cable Access business.

   “The sale of the Cable Access business enables us to sharpen our focus on our largest growth opportunities,” Harshman said in a statement. “Cable Access was Harmonic’s lowest margin product line, and through this transaction and the increase in our authorized share repurchase program, we will continue to drive growth in our core markets, expand our gross margin, reduce our outstanding shares, and position our business for stronger long-term earnings.”

   In addition to the selloff, Harmonic’s Board of Directors approved an increase to its current share repurchase program to include the net, after-tax cash proceeds from this transaction of approximately $35 million, contingent upon its closing.