BAY purchased PNRL and will competite to ASND and CSCO.
06/17 DJ =Bay Networks Says Penril To Help Cut Remote-Access Pdt Cost
By Mark Boslet
NEW YORK (Dow Jones)--Bay Networks Inc. (BAY) said its proposed purchase of
Penril DataComm Networks Inc. (PNRL) would let it cut the cost of its
remote-access products.
Remote-access servers are used by Internet-service companies, corporations
and telecommunications companies to handle modem call-ins from individual
computer users or branch offices. Bay plans to integrate Penril's
digital-signal processing, or DSP, modems with its remote-access servers by
the first quarter of 1997.
The company buys its modems from Microcom Inc. (MNPI) and will continue to do
so while the integration is underway, said Bruce Sachs, Bay's executive vice
president and general manager of its Internet-telecom unit. Afterward,
Microcom modems will be offered as an option to Penril's, he said.
Sachs said that by owning the Penril modem, Bay will be able to significantly
cut production costs of its remote-access products. Modems constitute as much
as 50% of overall costs, he said.
Also, because a DSP modem is software-based, instead of being permanently
etched in a microchip, it can be customized for particular uses, he said.
That should help Bay in its competition with companies such as Cisco Systems
Inc. (CSCO) and Ascend Communications Inc. (ASND), he said.
In a news release this morning, Penril said it will spin off its Access
Beyond unit to holders and sell its DSP modem unit to Bay Networks for $120
million.
Penril's shares rose 3 5/8, or 36.5%, to 13 5/8 recently on Nasdaq volume of
4.2 million. Average daily volume is 221,300. Bay's shares were off 1/2 at 26
5/8 on Nasdaq volume of 1.7 million, compared with average daily volume of 4.2
million.
(END) DOW JONES NEWS 06-17-96
3:47 PM
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