NeoPhotonics Buys Lightwave Micro
Lightwave Micro wasn’t broken up and auctioned off, as originally planned. Instead, the company was kept alive while a deal to sell it as an operating concern was hammered out with Neophotonics, as Light Reading reported last November and December (see Has Lightwave Micro Found a Buyer? and Lightwave Microsystems Reincarnated?).
Terms of the all-stock deal are not being disclosed, although one rumor puts the value at $2 million (see a message from "Dr. Darklight").
These days, it's common for a startup to shut down and sell off its technology on the cheap. But the Lightwave sale included the company's headquarters and manufacturing facility, which were never shut down, according to NeoPhotonics CEO Tim Jenks. "It even comes with heat and running water," he enthuses.
The deal also includes Lightwave's remaining employees, whose numbers are admittedly diminished. Combined, the companies employed more than 300 in September but now employ less than 100, Jenks says. The companies are combining their operations into Lightwave's headquarters in San Jose, Calif.
NeoPhotonics has kept rather quiet so far, but the company's been around since 1996. It's among the dozens of companies trying to craft Photonic Integrated Circuits, building nanoscale devices using a proprietary manufacturing method called laser reactive deposition.
Like many companies, NeoPhotonics sees product breadth as a key to survival, particularly with companies such as Cisco Systems Inc. (Nasdaq: CSCO) saying they want to limit their supplier rosters. In this case, NeoPhotonics had concentrated on the metro and access markets, while Lightwave was making products applicable to the long haul (see this message from Drew Lanza, one of Lightwave's founders, for more on what it was developing).
NeoPhotonics also picked up staff and assets from Symmorphix and Photonic Integration Research Inc. (PIRI) as the former went out of business and the latter was acquired by SDL (and, subsequently, by JDS Uniphase Corp. [Nasdaq: JDSU; Toronto: JDU]).
Beyond product breadth, integration is the way to add functionality to products, making the aquisitive company more valuable to both customers and investors, Jenks says.
"Ultimately we do believe integration is the key capability going forward. Whoever can integrate the most functions in the smallest space and at the lowest cost is going to win."
NeoPhotonics will be at the OFC Conference in March, showing products including a VOA multiplexer. The company also hopes to raise more money later this year, Jenks says.
— Craig Matsumoto, Senior Editor, Light Reading For up-to-date information about the coming OFC Conference, please visit Light Reading’s Unauthorized OFC Preview Site