Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.
December 21, 2004
LANNION, France -- Highwave Optical Technologies (Nouveau Marché,HGWO), a leading supplier of active optical fiber based components and subsystems fortelecommunications Dense Wavelength Division Multiplexing (DWDM) systems and thefiber laser, fiber optic sensor and defense markets, today announced the signing of amemorandum of agreement with the shareholders of Northlight Optronics for the acquisitionof 100% shares of that company.
Known as Ericsson’s optoelectronics division until 2003, Northlight Optronics is a Swedishcorporation which benefits from over 20 years of know-how in the design and production ofhigh performance optical transmitters and receivers for long distance, metro and Ethernetnetworks, as well as Erbium Doped Fiber Amplifiers for the telecom and defence markets.Northlight Optronics’ customer list includes: Lucent, Tellabs, Intel, Ciena, JDS Uniphase, andScientific Atlanta. Thanks to its leading technological position in the optical transmitter /receiver market, the company is currently in the qualification phase with several othertelecom equipment companies on next generation solutions which will be deployed as of2005.
The main shareholders of Northlight Optronics are CapMan, a leading Swedish private equityfunds with around EUR 1.2 billion under management, Ericsson, a leading telecom equipmentmanufacturer and European Digital Partners, a Swedish investment fund.
This acquisition, to be completed on the basis of a EUR 16 million valuation of NorthlightOptronics, would be financed through the issuance, in favor of its shareholders, of 26.7million new shares of Highwave at a price of 0.60€ per share. The 0.60€ per share valuationfor Highwave assumes that the proposed acquisition of DA-LightCom has been achieved andalso takes into account the average closing price of the Highwave shares for the last 45 daysuntil the signing of this Memorandum. On the basis of a closing date on February 28, 2005,the shareholders will guarantee that Northlight Optronics will have a positive cash situation ofno less than USD 4.1 million at the closing date and that the company will have no financialdebt. The shareholders of Northlight Optronics would also receive 2.740.182 subscriptionoptions (“bons de souscription d’action”) with a maturity date on January 29, 2007 and astrike price of 0.90€ per share. The full exercise of these options would provide Highwavewith an additional cash amount of EUR 2.466.164. A complete description of the transactionwill be presented to the shareholders of the company in a Document E which will be filedwith the Autorité des Marchés Financiers. The shareholders of Highwave will then beconvened at an extraordinary general meeting to approve the transaction.
The company mentions that the completion of this transaction is subject to the prior approval,by the shareholders of Highwave, of the acquisition of DA-LightCom.
In reference to the proposed transaction, Sylvain Boj, COO of Highwave, commented:“With revenues of about USD 2.3 million for the first 9 months of 2004, Northlight Optronicsbrings several benefits to Highwave:
The combination of Highwave’s know-how in the passive components domain toNorthlight Optronics’ technological leadership in the active components sector willallow a unique, global market offering which is highly sought-after by our majorcustomers.
Northlight Optronics’ strong presence in North America added to our client base inEurope and Asia will create strong commercial synergies without overlap in therevenues of either organization.
Northlight Optronics has adopted since this summer a business model similar toHighwave’s, i.e. based on the reduction of fixed costs. As a result, the combination ofour component purchasing and Asian outsourcing functions should have a positiveimpact on the profitability of the combined entity. In that regard, even thoughNorthlight Optronics has made an operating loss of USD 5.7 million for the first 9months of 2004, this past performance does not represent a relevant benchmark for theexpected performances of the company in the future.
With the acquisition of DA-LightCom, planned prior to this transaction, thecombination of Northlight Optronics, DA-LightCom and Highwave provides strongsynergies in technologies and sales.
François Leraillez, CEO, concludes on the strategic vision of the group:“The acquisition of Northlight Optronics is another step in our ambition to be among the fiveworld-wide actors in the optical sector within the next three years, thanks to our capacity torespond to our clients’ overall needs, our international presence and our technologicalsuperiority. With Northlight Optronics’ active sub-system technology, Highwave more thandoubles its addressable market size and intends to gain market share aggressively in allsegments and to achieve its growth strategy as the optical market shows signs of significantrecovery. This transaction depends on the prior approval of the acquisition of DA-LightCom.We count on the strong support of our shareholders to validate our growth strategy by votingfavourably during the next two extraordinary general meetings.”
Highwave Optical Technologies
You May Also Like
Rethinking AIOPs — It's All About the DataMar 12, 2024
SCTE® LiveLearning for Professionals Webinar™ Series: Fiddling with Fixed WirelessMar 21, 2024
SCTE® LiveLearning for Professionals Webinar™ Series: Cable and 5G: The Odd Couple?Apr 18, 2024
SCTE® LiveLearning for Professionals Webinar™ Series: Delivering the DAA DifferenceMay 16, 2024