Paris, May 13, 2003. Alcatel is divesting its optical components business to Avanex in a stock for stock transaction. This business will include key operations based in Nozay, France and Livingston, UK. As part of this transaction, Avanex is also acquiring certain assets of Corning's photonics activities. Alcatel will hold 28% of the combined entity.
"With this agreement, we are contributing Alcatel Optronics' outstanding technical expertise to an enlarged and credible partner that will support our optical networking activities, which are key to Alcatel. We have secured the future for Alcatel Optronics, in line with our strategy announced at the beginning of the year to find an alternative solution for our optical components business. As a result of this transaction, Avanex will hold a leadership position, providing leading edge technologies to a broad customer base, and will be able to achieve synergies and economies of scale that will allow it to remain competitive in today's landscape," said Christian Reinaudo, Executive Vice President of Alcatel.
The combined transaction is valued at approximately $63.5 million based on Avanex May 9 2003 closing price of $1.12 per share. Alcatel will retain 28% of Avanex post issuance share capital. Alcatel Optronics will bring a cash contribution of approximately $110 million, the majority of which will pertain to restructuring, to be finalized at closing.
Avanex and Alcatel have also entered into a supply agreement wherein Avanex will provide solutions for Alcatel's optical networking products over a three-year period. This transaction, which will be presented to Alcatel employees' representatives, is subject to the approval of Avanex shareholders and to customary regulatory approvals and is expected to close by September 30, 2003.
Laser Focus World