Creates World's Largest Supplier Exclusively Focused on Converged Optical EthernetIndustry Voices Strong Support for Newly-Transformed CienaLINTHICUM, Md., Mar 19, 2010 (BUSINESS WIRE) -- Ciena(R)
Corporation (NASDAQ:CIEN), the network specialist, today announced the
successful completion of its acquisition of substantially all of the
optical networking and Carrier Ethernet assets of Nortel's+
Metro Ethernet Networks (MEN) business.
The $773.8 million (USD) aggregate purchase price for the acquisition
consists entirely of cash. The purchase price is subject to adjustment
based upon the level of net working capital transferred to Ciena at
closing, which is currently estimated to result in a downward adjustment
to the aggregate purchase price of approximately $62 million (USD). In
accordance with the asset sale agreement, prior to the closing Ciena
elected to replace the $239 million (USD) in convertible notes that were
to be issued as part of the aggregate purchase price with cash
equivalent to 102% of the face amount of the notes replaced, or $243.8
million (USD).
"The acquisition of these assets accelerates Ciena's overall strategy
and gives us stronger operating leverage to continue investing in
innovation that will allow us to deliver on our vision for
next-generation networks," said Gary Smith, Ciena's president and CEO.
"With broader geographic reach, deeper customer relationships and a
stronger portfolio of solutions, we're confident that this acquisition
positions Ciena for faster growth."
Ciena already has completed several important milestones in its
comprehensive integration plan, and remains focused on ensuring a smooth
transition for the benefit of both customers and employees. Specifically:
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Ciena has selected its senior management and extended leadership teams
and defined their areas of responsibility and accountability, and
identified and confirmed substantially all of the organizational
structure to the extent permitted by applicable law.
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Nearly 100 percent of the employment offers Ciena has extended to
Nortel MEN employees have been accepted, including a significant
number in management positions.
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Ciena has ensured that upon closing the applicable Nortel customer and
supply contracts will successfully transition to Ciena.
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Philippe Morin, previously president of Nortel MEN, has been appointed
Ciena's Senior Vice President, Global Products Group.
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The vision for the transformed product portfolio has been determined,
and a comprehensive portfolio update will be announced March 22, 2010.
Smith continued, "As we unite these two organizations, we are
emphasizing performance in every aspect of the business and are
organizing the newly-transformed Ciena to ensure we remain operationally
efficient and financially strong. Staying true to our specialist roots,
Ciena is now the only global supplier exclusively focused on converged
optical Ethernet as a foundation for the next generation of service-and
application-driven networks - creating a true industry leader."
A number of existing Ciena and Nortel MEN customers and partners have
commented on the completion of this acquisition, including:
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Tim Harden, President, Supply Chain and Fleet Operations, AT&T,
said: "We believe that consolidation of optical networking and Carrier
Ethernet assets will accelerate innovation and speed to market for new
technologies and network solutions. Our goal is to ensure that each
investment in network infrastructure accelerates our move towards a
network that enables the full promise of the Internet and other
game-changing technologies."
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Phil Male, Chief Strategy Officer at Cable & Wireless Worldwide,
said: "We've worked with both Nortel and Ciena historically, and the
coming together of these two businesses is a logical fit - I'm sure
we'll enjoy a strong relationship with the combined business going
forward."
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Bill Teuber, Vice Chairman, at EMC Corporation, said: "EMC and
Ciena have a long history of partnering together to provide
industry-leading information infrastructure solutions to our customers
around the world. Ciena's acquisition of these well-established
networking assets will help EMC and Ciena provide a broader range of
solutions for our joint customers."
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Paul Frizado, Chief Technology & Information Officer at MTS
Allstream, said: "As a partner to both Ciena and Nortel's MEN
group, we've had a front row seat to the exciting possibilities this
deal represents in terms of advancing networking through innovative
technology. We view this as an opportunity to work with a strategic
industry partner to continue to build a simpler, more cost-effective
network that can reliably deliver compelling services, applications
and content to our residential and business customers across Canada."
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Consuelo Gómez Colín, COO of Telmex said: "We are pleased to
see Nortel's optical and Carrier Ethernet assets land with Ciena. The
combination of these two industry leaders offers us an even stronger
and more capable partner for bringing the best in network innovation
to our customers."
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Zouheir Mansourati, Vice President, Technology Strategy at TELUS,
said: "Our focus is on delivering the best solutions for Canadians at
home, at the workplace and on the move, which requires a dynamic,
reliable and high-capacity network. Ciena's acquisition of Nortel's
MEN assets ensures the continued delivery of the advanced optical
networking solutions that are part of our network while ensuring
TELUS' heritage of designing, building and deploying advanced
networking technology."
"We remain committed to providing stability, continuity of supply and
innovation to our customers through individualized, high-touch
attention. This will ensure that we remain a trusted partner in evolving
networks and enabling our customers to create new and differentiated
services to capture market share," said Mike Aquino, senior vice
president, global field organization at Ciena.
About Ciena
Ciena specializes in practical network transition. We offer leading
network infrastructure solutions, intelligent software and a
comprehensive services practice to help our customers use their networks
to fundamentally change the way they compete. With a global presence,
Ciena leverages its heritage of practical innovation to deliver maximum
performance and economic value in communications networks worldwide. We
routinely post recent news, financial results and other important
announcements and information about Ciena on our website. For more
information, visit www.ciena.com.
Note to Ciena Investors
Forward Looking Statements: This press release contains certain
forward-looking statements based on current expectations, forecasts and
assumptions that involve risks and uncertainties. These statements are
based on information available to the Company as of the date hereof; and
Ciena's actual results could differ materially from those stated or
implied, due to risks and uncertainties associated with its business,
which include the risk factors disclosed in its Report on Form 10-Q,
which Ciena filed with the Securities and Exchange Commission on March
5, 2010. Forward-looking statements include statements regarding Ciena's
expectations, beliefs, intentions or strategies regarding the future and
can be identified by forward-looking words such as "anticipate,"
"believe," "could," "estimate," "expect," "intend," "may," "should,"
"will," and "would" or similar words. Ciena assumes no obligation to
update the information included in this press release, whether as a
result of new information, future events or otherwise.
+'Nortel' is a trademark of Nortel Networks, used
under license by Ciena.
SOURCE: Ciena Corporation
Ciena Corporation
Press Contact:
Nicole Anderson, 877-857-7377
or
Investor Contact:
Lisa Jackson, 888-243-6223
ir@ciena.com