JANUARY 3, 2008 -- LanOptics Ltd. (search for LanOptics), a provider of Ethernet network processors, announced today that the last two principal shareholder groups of its subsidiary, EZchip Technologies Ltd. (search for EZchip Technologies), have elected to exchange all of their shares of EZchip for shares of LanOptics.Â This exchange represents the last major step in LanOptics' long-term plan to acquire 100% ownership of EZchip.
LanOptics says it will acquire preferred shares of EZchip from the two principal shareholders, representing the equivalent of 20,047,365 EZchip ordinary shares, in exchange for the issuance of 5,011,841 LanOptics shares.Â The resulting dilution in each LanOptics shareholder's percentage of ownership will be substantially offset by the increase in LanOptics' holdings in EZchip.Â LanOptics' business consists exclusively of the business of EZchip, a company that is engaged in the development and sales of Ethernet network processors.
Following the exchange, LanOptics will own approximately 99% of the outstanding share capital of EZchip or 89% on a fully diluted basis.Â The residue represents unissued EZchip shares subject to outstanding EZchip options held by current and former employees of EZchip.Â Pursuant to the exchange agreement, LanOptics is required to register the shares issued in the exchange with the U.S. Securities and Exchange Commission.
LanOptics further announced that starting tomorrow, January 4, 2008, the company's ordinary shares will be traded on the NASDAQ Global Market. The company has also applied to change its trading symbol from "LNOP" to "EZCH" effective January 17, 2008.Â
"It is an exciting day in the history of our company and the beginning of a new era," contends Eli Fruchter, chairman of LanOptics and CEO of EZchip.Â "It has been our long-term goal to acquire full ownership of EZchip, and we are excited to finally reach this milestone. We expect the rationalizing of our corporate structure and the unifying of the shareholdings in the two companies under our EZchip brand name to further support the company's continued growth and allow various efficiencies in the operation of the businesses."Â
"We are also delighted to announce our upgrade to the NASDAQ Global Market--a testament to the company's recent results and increased trading in the company's shares," he adds.Â "We expect the move to the more prestigious NASDAQ Global Market, combined with our new trading symbol--"EZCH", once approved--will provide greater visibility and liquidity to our shares and promote our EZchip brand name recognition."
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