Pace steps up as investors back move

SHAREHOLDERS have overwhelmingly backed Pace's £301m ($475m) acquisition of US broadband company 2Wire.

The Saltaire firm will be catapulted to third in the global 'home hub' or 'residential gateway' market when the deal completes in the next few days.

Pace already has US regulatory approval for the purchase and last month secured financing, signing up HSBC and Royal Bank of Scotland to provide fully underwritten facilities.

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The majority of shareholders at or voting in proxy at the meeting, held at the company's Saltaire home, backed the acquisition. Votes representing some 218 million shares approved the deal, while five million shares were voted against it. The purchase of 2Wire will allow Pace to take another giant stride into the US market, which is the leading marketplace for next-generation digital home entertainment services.

Residential gateways are home networking devices which allow consumers to connect technology such as high definition TV, digital video recorders, video on demand, digital photography, home CCTV and gaming consoles, to create a "convergent experience".

The residential gateway market is currently worth about $3bn globally and forecast to grow to $7bn within three to four years.

Pace is the world's biggest supplier of set-top boxes to the pay-TV market and its strategy is to "put Pace at the heart of convergence for the digital home".