CIENA completes acquisitions of Catena and Internet Photonics
May 3, 2004 Linthicum, MD -- CIENA announced the completion of its acquisitions of Catena Networks and Internet Photonics pursuant to the terms of merger agreements announced on February 19, 2004.
May 3, 2004 Linthicum, MD -- CIENA announced the completion of its acquisitions of Catena Networks and Internet Photonics pursuant to the terms of merger agreements announced on February 19, 2004. Catena provides CIENA with an installed base of copper and fiber-based broadband access technologies at U.S. carriers. Internet Photonics, a provider of optical Ethernet transport and switching equipment, has technology deployments with carriers, as well as seven multiple system operators.
"The addition of Catena and Internet Photonics accelerates CIENA's expansion beyond optical infrastructure, furthering our transformation into a comprehensive networking and service delivery partner for our customers," said Gary Smith, CIENA's president and chief executive. "CIENA can now offer customers integrated solutions that span from the optical core of their networks to the very point at which revenue is generated -- where they create and deliver the next-generation of voice, video, and data services to both enterprises and consumers.
"We are very pleased to have the Catena and Internet Photonics teams on board, and we are excited about the new opportunities they bring to CIENA, our customers, shareholders, and employees," said Smith.
In the Catena transaction, CIENA acquired all outstanding shares of Catena's common and preferred stock, and assumed all outstanding employee stock options in exchange for approximately 75.9 million shares of CIENA's common stock.
In the Internet Photonics transaction, CIENA acquired all outstanding shares of Internet Photonics' common and preferred stock, and assumed all outstanding employee stock options in exchange for approximately 24.1 million shares of CIENA's common stock. The number of CIENA shares was determined based on the average closing price of CIENA common stock for the 10 days prior to the signing of the merger agreement on February 18, 2004.
For accounting purposes, the value of both transactions will be determined using a five-day average of the closing price of CIENA's common stock beginning on February 17, 2004, two trading days prior to CIENA's announced intention to acquire the companies. The majority of the CIENA common shares issued in the transactions are not subject to lock-up provisions and therefore are freely tradable effective with the close.
Combined, Catena and Internet Photonics add approximately 380 employees to CIENA. Effective immediately, Catena becomes CIENA's Broadband Access Group, led by former Catena Chief Executive, Jim Hjartarson. Internet Photonics becomes part of CIENA's Metro and Enterprise Services Group (MESG) led by James Frodsham who recently joined CIENA. Frodsham's previous experience includes more than 10 years at Nortel where he held several senior level positions.
CIENA expects to consolidate several CIENA, Catena and Internet Photonics facilities and as a result, will take on no incremental long-term facilities with the acquisitions. CIENA will consolidate its existing Kanata, Ontario operations into Catena's Kanata facility. Catena's Research Triangle Park, NC, operations will be consolidated into CIENA's existing Research Triangle Park facility. CIENA's Red Bank, NJ, operations will be consolidated into Internet Photonics' Shrewsbury, NJ, facility. Internet Photonics' Marlborough, MA, operations will be consolidated into CIENA's existing Acton, MA, facility.
Following these facility consolidations, CIENA will operate development centers in Alpharetta, GA, Linthicum, MD, Acton, MA, Shrewsbury, NJ, Research Triangle Park, NC, and Kanata, Ontario. CIENA previously announced its intent to close its San Jose, CA, facility by September 30, 2004.