Pirelli Buys Avanex Stake

MILAN, Italy -- The Pirelli Group signed with Alcatel-Lucent an agreement to acquire the 12.4% stake held by Alcatel-Lucent in Avanex Corporation (a company listed on NASDAQ) at a market price of approximately 33.4 million euros.

With this agreement Pirelli becomes the main industrial investor in Avanex, one of the major worldwide players in optical modules and components for telecommunications. Pirelli’s entry into the share capital of Avanex takes place in a spirit of total cooperation between the two companies.

The Pirelli Group’s Broadband Solutions unit and Avanex, which have complementary technology capabilities, will explore collaboration for the development of advanced and cost-effective optical solutions to meet growing consumer demand driven by broadband applications such as IPTV (Internet Protocol Television).

Within the framework of this transaction, Alcatel-Lucent signed supply agreements with both Pirelli and Avanex for related components.

“The supply agreement with Alcatel-Lucent and the investment in Avanex,” said Claudio De Conto, General Manager, Operations, of Pirelli, “strengthen the Group’s presence in the core business of second generation photonics after the start-up, in 2001, of the Pirelli Labs advanced research center and the incorporation in early 2005 of Pirelli Broadband Solutions, built on a long history of experience in the field.”

Pirelli Broadband Solutions

Alcatel-Lucent (NYSE: ALU)

Avanex Corp. (Nasdaq: AVNX)