ADC Completes FONS Acquisition

ADC announces it has completed the acquisition of Fiber Optic Network Solutions (FONS)

August 30, 2005

2 Min Read

MINNEAPOLIS -- ADC (NASDAQ:ADCT) ( today announced it has completed its acquisition of Fiber Optic Network Solutions (FONS) Corp. (, a leading manufacturer of high-performance passive optical components and fiber optic cable packaging, distribution and connectivity solutions.

With the addition of FONS, ADC now becomes one of the largest suppliers of fiber-to-the-x (FTTX) solutions in the United States, according to proprietary market share estimates.

"We are excited to add the innovative technologies that FONS has developed into our portfolio of FTTX solutions," said Robert E. Switz, president and CEO for ADC. "As a combined company, we can more fully leverage our strengths to deliver on customer demands for fiber in the central office, the outside plant and at the customer premises. In addition, the acquisition enhances our capabilities to capitalize on an FTTX market that has significant future growth potential."

ADC's OmniReach(R) Solutions are the industry's first platforms designed from the ground up to meet the unique requirements of FTTX networks. By building network infrastructures using ADC's OmniReach Solutions, service providers nationwide are accelerating deployment and maximizing operational efficiency from the central office to the outside plant. Through its Professional Services organization, ADC also provides a suite of service solutions to plan, deploy and maintain FTTX NETWORKS.

The FONS acquisition approximately doubles ADC's FTTX outside plant business to greater than 10% of total ADC sales and will be accretive to earnings per share, excluding acquisition-related charges, acquired intangibles amortization and FONS employee retention payments. The acquisition was completed for approximately $172 million in cash. This amount is inclusive of a retention bonus pool that will be paid to most of FONS' current employees. FONS has approximately 60 employees worldwide and estimated calendar 2005 sales of $95 million. In addition to a facility in Marlboro, Massachusetts, FONS has strategic partnerships and outsourcing relationships in countries including Mexico, Japan and China.

"ADC's acquisition of FONS is strategically important as equipment vendors continue to consolidate in the industry," said Matt Davis, director of Broadband Access Technologies for Boston-based Yankee Group. "As they were, both entities gained considerable market penetration as fiber deployments began to ramp up in 2004 and deployments continue to broaden today. The combination makes sense as service providers look to equipment providers that can quickly scale to enable mass-market deployments."

ADC Telecommunications Inc.

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