MRV Communications (MRVC) opinions? Message Board

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Technology Stocks : MRV Communications (MRVC) opinions?

MRVC 9.975

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Aug 15 5:00 PM EST

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From: hedgeclipper	5/25/2006 4:50:29 PM
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We are told the HG Genuine acquisition will boost Luminent revenues 20% to 25%. Sounds about right with a reasonable rounding up of HG’s 2005 revenue… Turnover in 2005 $17.3 Million chinakorea.cccme.org.cn Indirectly I think this is telling us Luminent revenues will approximate 90-100 million for the year… I speculate the acquisition will close in the next 60 days. The combined entity will need a year more or less of operations upon which to base the prospects of the company post-IPO. They also need the time to make personnel adjustments including finding a new CFO as this guy doesn’t quite look ready for it.. LUMINENTOIC, INC. YOSSI Jakubovits CHIEF FINANCIAL OFFICER 20550 NORDHOFF ST. CHATSWORTH, GA 91311 Jakubovits Yossi CPA 15303 Ventura Blvd Sherman Oaks Getz Krycler & Jakubovits Acco 15303 Ventura Blvd Ste 1040 Sherman Oaks, CA 91403 818-995-1040 I am sure he is a good little family accountant and fine for Luminent in its current state, but not the kind of background or full time commitment Luminent needs for its CFO when it becomes a public company again. Been there, done that with Shay… Blueshirts, you need to get on this right away… I think the timing of the IPO event will come in the spring of 2007 or in the fall of that year, which not un-coincidentally would be about the time GPON is rolling out full blast.. Because the acquisition builds their module capacity to almost 3 million a year from the present 1.2 million or so, Luminent must feel very confident that not only will they expand their current BPON business but also they will get a significant share of the RBOC GPON business not only for the ONT but also the OLT. Finally they must see the DWDM metro transceiver market continuing to grow on its current trajectory of 50% per year. There remains some significant execution risk here especially with the history MRV has had with Luminent and IPO’s. But this acquisition also clarifies some attractive opportunities for Luminent and MRV in the year ahead. During 2005, NL made clear MRV’s networking side was operating at breakeven or slightly profitable. On more than one occasion, he also made it clear that all corporate overhead expenses were allocated to the networking side of the business. I could never figure out why they kept making this point but now I think I know.. After the HG Genuine closing, Luminent HG will be separated from MRV and will have to absorb its share of these kinds of overhead expenses on its own. MRV will then be operating even further into the black without the burden of Luminent’s corporate overhead. Sustained profitability??? Hedge..

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