EMCORE's tunable laser and transceiver lines move to NeoPhotonics as acquisition closes

EMCORE Corp. (NASDAQ:EMKR) and NeoPhotonics Corp. (NASDAQ:NPTN) announced the close of a deal that sees the former's tunable laser and transceiver product lines move to NeoPhotonics (see "NeoPhotonics to buy EMCORE's tunable laser and optical transceiver lines"). EMCORE received $17.5 million for the assets, with $1.5 million of the total in cash and the rest via a promissory note from NeoPhotonics.

The promissory note will mature two years from the closing date of the transaction, subject to repayments under "certain circumstances" the two companies did not detail. The purchase price is further subject to post-closing adjustments for inventory, net accounts receivable, and pre-closing revenue levels that may affect the final size of the promissory note.

For NeoPhotonics, the acquisition is all about the tunable laser technology (see, for example, "Dual micro integrable tunable laser touted by EMCORE"). "EMCORE's narrow linewidth tunable laser product line is highly complementary to our broad existing portfolio of optical components for 100-Gbps coherent transport systems, and this acquisition significantly expands our footprint in this rapidly growing segment," said Tim Jenks, chairman and CEO of NeoPhotonics, via a press statement. "EMCORE's external cavity tunable laser has the narrowest linewidth in the industry, which we believe will become increasingly important for advanced modulation schemes at 400G and beyond. Combining this business into NeoPhotonics will allow us to provide customers with a full product suite that serves the full coherent market."

NeoPhotonics expects the assets to be accretive on a non-GAAP earnings-per-share basis by the second quarter of 2015.

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