NETGEAR, Inc. announced that its Board of Directors has unanimously approved the pursuit of a separation of its Arlo business from NETGEAR. The separation is expected to be effected through an initial public offering (IPO) of newly issued shares of the common stock of Arlo Technologies, Inc. (Arlo), which will hold the Arlo business.
NETGEAR expects Arlo to issue less than 20% of its common stock in the IPO, with NETGEAR to retain the remaining interest. NETGEAR expects Arlo to confidentially submit a draft registration statement with the Securities and Exchange Commission (SEC) in the first half of 2018, with the IPO expected to be completed in the second half of 2018.
NETGEAR currently intends that, following the IPO, it will distribute the shares of Arlo common stock then held by NETGEAR to NETGEAR’s stockholders in a manner generally intended to qualify as tax-free to NETGEAR’s stockholders for U.S. federal income tax purposes.
Concurrent with the announcement of the planned separation of the Arlo business, NETGEAR also today announced that it expects Matthew McRae to serve as Arlo’s CEO upon the completion of the IPO. McRae joined NETGEAR approximately four months ago as SVP of Strategy. Prior to this he was at Vizio, where he was the Chief Technology Officer and Head of Marketing.
The separation of the Arlo business, including the IPO and distribution, will be subject to market, tax and legal considerations, final approval by the NETGEAR board of directors and other customary requirements.
This press release does not constitute an offer to sell or the solicitation of an offer to buy securities, and shall not constitute an offer, solicitation, or sale in any jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of that jurisdiction.