Will Tellabs Take Polaris?
So far, the only potential acquirer's name to pop up is Tellabs Inc. (Nasdaq: TLAB; Frankfurt: BTLA).
Polaris, which makes a metro switch combining digital crossconnect and Sonet ADM functionality, might make a nice complement to Tellabs' recent buys. Tellabs has beefed up its access portfolio with the purchase of Advanced Fiber Communications and Vinci Systems, a developer of optical networking terminals for fiber-to-the-home (FTTH) access systems (see Tellabs & AFC: Together at Last!, Polaris Lifts Off, and Tellabs Vacuums Up Vinci).
Tellabs spokesperson Ariana Nikitas would not comment on the rumors. “All I can say is that we can not discuss any type of rumor about acquisitions,” she said when contacted today.
Speculation is that Polaris, which reportedly just landed deals with two bit players, has a large contract in the works that is conditional upon a buyout. Possibilities include AT&T Corp. (NYSE: T), Sprint Corp. (NYSE: FON), and Verizon Communications Inc. (NYSE: VZ), each of which has reportedly trialed Polaris’s switches.
Polaris president and CEO, Surya Panditi, confirmed that the company has recently landed some deals, but would not go into details until after the deals are announced, possibly as early as next week. While he wouldn't comment on the acquisition rumor, he did say, "We're in some discussions regarding the company, but I can't comment on the nature of those discussions or who they're with at this point." Polaris, founded in June 2000, develops optical transport switching systems for metro core networks. The capacity of its OMX switch starts at 240 Gbit/s and scales to 2 Tbit/s, and it handles circuits in smaller increments than core switches -- VT1.5 (1.7 Mbit/s) vs. STS1 (51.84 Mbit/s).
The company has received $77 million in funding to date from Redpoint Ventures, Venrock Associates, Storm Ventures, Advanced Technology Ventures (ATV), Firsthand Capital Management Inc., Granite Global Ventures, KTB Venture Capital, Pac-Link Management Corp., Presidio Venture Partners LLC, Riverside Management Group Inc., Western Technology Investment, and WK Technology (see Polaris Platform Scores With VCs).
This is not the first time Polaris has been rumored to be on the block. Back in 2002, the company was reportedly looking for a buyer in order to score a big deal with AT&T (see Who Will Pick Up Polaris? ).
— Chris Somerville, Senior Editor, Next-Generation Services