More on Mory and Zhone! Very interesting!!!
mercurynews.com
Ejabat's new firm in twilight Zhone
BY SCOTT HERHOLD
Mercury News Staff Writer
WHEN Lucent Technologies Inc. announced its acquisition of Ascend
Communications Inc. early this year, one of the key unanswered questions was
what would happen to Mory Ejabat, Ascend's CEO, who served early notice that
he wasn't going to stay with Lucent. Now some of those questions are being
answered -- but only in part, and only with an edge of mystery.
Ejabat is now the chairman and CEO of Zhone Technologies Inc., an Oakland
start-up with a lot of cash and some very big ideas. He's brought some of the old
Ascend management with him, including CTO Jeanette Symons and CFO Robert
Dahl. On its Web site, the company says -- modestly -- that its goal is to deliver
``the next generation network.'
Late Wednesday, a spokesman for the young company sent out word that Zhone would make a very big announcement
today: It was getting $500 million in funding from a group that includes Kohlberg Kravis Roberts & Co. (KKR),
Texas Pacific Group Inc. and the venture firm of New Enterprise Associates.
KKR and Texas Pacific are well-known leveraged buyout firms that have been trying to enlarge their perch in Silicon
Valley. The model departs sharply from the ordinary venture investment. Instead of giving a start-up a little money to
grow a business, KKR and Texas Pacific are giving it a huge amount to go out and buy others. Think of a minnow
swallowing a colony of seals, and you'll understand.
The kicker was supposed to be that Zhone would also announce the acquisition of a public company today, the first of
what it said was ``many big and small acquisitions to come.'
Then something unexplained happened. A spokesman for Zhone called back to say that the lawyers had advised that the
announcement was off. Zhone says its $500 million, a placement handled by Credit Suisse First Boston, is still
assured. But its effort to begin the next generation of networking has begun with a bit of static. |
