Optical components

JDSU to Split in Two

JDSU, which took one of the wildest rides of any telecom company during the industry's turn-of-the-century boom-and-bust cycle and survived (well, in some form anyway), announced a plan to split into two separate companies -- an optical components firm and a network and service enablement company with SDN ambitions.

JDSU (Nasdaq: JDSU; Toronto: JDU) released a statement on the plan after markets closed Wednesday, and said it would provide more details during its analyst day event on Thursday. The split is to take effect by the third quarter of 2015.

The optical networking business, which will consist of lasers and other optical products, will be created from the part of JDSU that brought in the most revenue over the last year, about $742 million, according to the company's fiscal-year earnings results reported last month. The network and service enablement company will consist of JDSU's network and service enablement group, which collected $728 million over the last year, as well as an optical security group, which brought in $205 million in revenue over the same period. JDSU President and CEO Henry Waechter will lead the latter spin-off, while Executive Vice President Alan Lowe will lead the optical components spin-off.

Notably, the network and service enablement company will have SDN among its missions, or as the statement put it, will invest in "software supporting virtualized and software-defined networks."

Want to know more about optical components? Check out our dedicated optical components content channel here on Light Reading.

The corporate split will bring an end to one of the more recognizable names in the telecom industry, a name once attached to a notorious M&A machine that quickly grew into a company worth more than $100 billion at its height, but which later laid off thousands of employees and wrote off billions of dollars when the market turned sour circa 2001. JDSU reportedly pondered an exit from the optical sector years later before recommitting to it. (See JDSU Writes Off Billions More, JDSU's Acquisition Hangover and JDSU May Be Mulling Optical Exit.)

In fact, announcement of the plan comes after JDSU has spent the last couple of years revving up its acquisitions engine again, buying its way further into the mobile market and application performance segment. (See JDSU Buys More 4G SPIT Smarts, JDSU Acquires Network Instruments and JDSU Acquires Arieso for $85M.)

— Dan O'Shea, Managing Editor, Light Reading

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