Red-C provides erbium-doped fiber amplifiers (EDFAs), Raman amplifiers and optical monitoring devices for long-haul, regional, metro and access networks. The company, which is incorporated in Delaware but has operations in Tel Aviv, has 140 employees.
The deal is expected to close by July 31.
Why this matters This could help Finisar counter the vertical integration of JDSU (Nasdaq: JDSU; Toronto: JDU). One of JDSU's strengths is its ability to combine multiple line cards into one -- putting a ROADM together with an EDFA and optical channel monitors, for instance. (See OFC: JDSU & Superblade! and Finisar vs JDSU.)
"We generally view this acquisition as consistent with Finisar's strategy of vertical integration," writes analyst James Kisner at Jefferies & Co. Inc. in a note published Tuesday. "We expect this acquisition could make Finisar more competitive with JDSU in the ROADM line card space."
Red-C, which has been around since the dawn of Light Reading, also brings a long-haul amplifier business that Finisar doesn't have, along with some future prospects. Red-C thinks its Hybrid Raman-EDFA platform can replace plain EDFAs in future long-haul and ultra-long-haul networks.
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— Dan Jones, Site Editor, Light Reading Mobile