Mavenir gains new $500m cash injection as it opens UK O-RAN development centre

Mavenir has signed an agreement with Koch Strategic Platforms (KSP) for a minority equity investment of $500m, while revealing plans to open a development centre in the UK that will focus on open radio access network (O-RAN) software.

Created in 2020 and with offices in Atlanta and Wichita in the US, KSP claims to be the preferred investment partner of growth-focused strategic companies that are innovating in “new economy” industries with a focus on growth equity through four thematic sectors – computing and connectivity, industrial automation, energy transformation, and healthcare.

“We are taking material minority equity positions in innovative, disruptive companies with strong management teams that operate in industries with significant tailwinds,” said KSP president David Park. “We want to partner with companies that can transform Koch Industries for the future. Mavenir checks all the boxes.”

Mavenir said that given the equity firm’s focus and aims, KSP is a natural partner for its 5G transformational efforts. “We have built a next-generation software platform that has driven, and will continue to drive, the digital transformation of mission-critical networks,” said Pardeep Kohli, president and chief executive officer at Mavenir.

“Together with KSP and our service provider customers, we expect to bring innovation and 5G to revolutionise industries such as energy, industrial automation and healthcare. Not only do we have the only end-to-end, cloud-native, 5G software platform in the world, but we also have strong and extensive relationships with CSPs and proven deployments of our technology around the globe. With 5G here, Mavenir is well positioned to build the future of networks.”

Even after the new investment, affiliates of technology-focused private equity firm Siris Capital Group will remain majority equity holders in Mavenir. It said it was “extremely proud” of what Mavenir has achieved to date and was excited about partnering with KSP to drive what it said would be continued innovation.

Siris said the combination of Mavenir’s 5G software platform and Koch Industries’ presence in relevant industry verticals would accelerate its participation in a “massive” digital transformation opportunity.

“We have been anticipating the transformation of mobile networks, and that time has arrived,” said Siris co-founder Frank Baker. “Mavenir is uniquely positioned to lead the 5G transformation, given its investment in disruptive products like O-RAN, and extensive relationship with over 250 CSPs. We are excited about the partnership with KSP and the strategic growth opportunities that we will tackle together.”

Furthering developing O-RAN capabilities is the aim of Mavenir’s new UK development facility in Swindon, which is part of a larger programme to increase the firm’s presence and contributions in the UK and follows the acquisition of ip.access and the opening of the centre of excellence for multi radio access technology in Cambridge.

The new centre will be dedicated to software and system design for O-RAN radio units and is intended to broaden the future development of O-RAN-based systems. One of the key projects is the development of open source software for the control board and management plane of the O-RAN 7.2 compatible remote radio unit (RRU).

This software is intended to be made available to all RRU manufacturers to accelerate the availability of O-RAN RRUs in different versions and frequencies while providing a common management interface. This initiative will enable MNOs to have the same management software on any O-RAN RRUs, independent of supplier, and provide an even smoother interoperability and upgrade path.

“This work is another step in validating the principles of O-RAN while simplifying element integration into operator networks through the use of a common RRU interface,” said Mikael Rylander, senior vice-president and general manager at Mavenir. “We are providing tools and open source software to the RRU community in order to let them focus on their unique strengths and intellectual property rights in the digital and analogue performance parts of the radio. We aim to simplify interoperability across all O-RAN interfaces, including orchestration and maintenance capabilities.”

The new centre is also designed to support the UK government’s vendor diversification strategy, unveiled in December 2020, and the Telecoms Diversification Taskforce report just published by the Department for Culture, Media and Sport.

The report concluded that successful diversification would require specific and targeted interventions to stimulate the supply market, de-risk the integration of new suppliers into operator networks and  lay the foundations for long-term market growth and increased supplier competition.

The taskforce’s overall view was that direct funding for operators to adopt new suppliers of O-RAN into their networks was unlikely to be a sustainable approach to achieving diversification in the long term, based on the taskforce’s view of current market conditions.

Instead, it said, the UK government could derive best value for money by directing funding to support or incentivise R&D activity in this area, catalysing the UK ecosystem and removing barriers to entry. It said the government needed to consider the case for funding activities that move the market in the right direction, but should be careful and measured in how it does so, to ensure it prioritises promoting healthy, sustainable and competitive behaviours where the UK can participate in the supply chain.

Part of the government’s technology diversity plan has included funding a new O-RAN trial with Japanese telecoms supplier NEC which aims to see live 5G O-RAN systems launched in the UK in 2021.