EXFO's founder on what's next for the newly private companyEXFO's founder on what's next for the newly private company
Germain Lamonde fended off a hostile takeover attempt by rival Viavi and made EXFO a private company again. Now he's opening up on what the company plans to do next.
September 7, 2021
Germain Lamonde, EXFO's founder and majority shareholder, said to expect "more of the same" from the company now that it's no longer public.
"There's a lot of reasons to go private," Lamonde told Light Reading about his decision to fend off a hostile takeover attempt by rival Viavi and make EXFO a private company again. But he said the company's strategy as a private company will be the same one it employed as a public company: "EXFO's brand is really about innovation."
He said the company will continue to sell test and measurement equipment for telecom networks to help operators make them more efficient, whether that's a fiber network or a 5G network.
Lamonde explained that EXFO rejected Viavi's takeover efforts in part because the company's customers wanted to prevent the creation of a dominant supplier in the test and measurement market. Maintaining a competitive market with multiple suppliers "keeps the price reasonable" for customers, he explained.
Moreover, he said EXFO's management team will no longer be tied to the rigors of quarterly financial reports now that EXFO is private. And he suggested the company would be better able to make smart acquisitions as a private company.
Looking to the future
Lamonde said EXFO sees a bright future in selling testing and measurement equipment for fiber and 5G networks. "We're really engaging in this new chapter with more energy than ever," he said.
In fiber, he said the company is seeing increasing movement toward 400G and 800G products, and that it will have products for those areas as a result. And in 5G, he said EXFO hopes to aid in the transition from non-standalone networks to standalone networks by applying artificial intelligence (AI) and machine learning (ML) technologies to its offerings.
As Lamonde navigates EXFO into its new phase as a private company, he's facing a handful of massive trends, both positive and negative.
On the positive side, he said the global trend toward government funding for broadband is "a good, smart move." That's not a surprise considering EXFO likely stands to benefit from that kind of spending. In the US, for example, legislators appear poised to funnel almost $65 billion into the telecom market over the coming years, money that will likely benefit all kinds of providers and suppliers.
On the negative side, though, Lamonde said EXFO has been affected by ongoing electronics component shortages that have tripped up a number of different industries, from telecom to automotive. He said EXFO has done "very, very good work" in circumventing the situation, though the company has struggled to obtain enough components to continue supplying its customers.
Interestingly, he said EXFO has not yet been forced to increase the prices on its products as a result of the component shortages. But he said the company may have to do so in the future if the situation persists.
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