Lucent buys another networker that isn't FORE:
Lucent Technologies To Purchase Livingston Enterprises, Inc., A Leader In Remote Access Networking For The Internet
MURRAY HILL, N.J.--Oct. 15, 1997
Purchase of Livingston Adds to
Enhanced Data Networking Portfolio
In another step to address high-growth opportunities in the Internet and data networking business, Lucent Technologies today said it will acquire Livingston Enterprises, Inc., a leading provider of remote access networking solutions, in a merger involving approximately $650 million worth of Lucent stock. Livingston is a leading global provider of equipment that remotely connects computers to providers of Internet service. The transaction is expected to be completed by the end of December.
"While the data networking industry is growing rapidly, the remote access business is particularly attractive, with overall growth at more than 20 percent and with the demand for equipment to service providers growing by nearly 50 percent annually," said Bill O'Shea, president of Lucent's Business Communications group, who has overall responsibility for the corporation's data networking strategy. "By purchasing Livingston, we have the opportunity to add significant new data networking revenue."
"Just last month Lucent introduced a strategy to address the data networking business and a series of new products that were positively received by the industry," said Harry Bosco, president of Lucent's Broadband Networking Systems group. "Today we are taking the next step in implementing that strategy by adding Livingston's people and their next-generation products to our portfolio -- making our offer to service providers and enterprises even more powerful."
Livingston, as a division of Lucent, will remain headquartered in Pleasanton, Calif. The division will be headed by Steven Willens, its current president and CEO. The division will report to O'Shea.
"We are tremendously excited about becoming a part of Lucent," Willens said. "On our own, we built a leadership position providing remote access servers to more than 2,200 Internet Service Providers (ISPs) around the world," he said. "Just think what we can do with the relationships and resources of Lucent behind us."
"With our existing remote access server family and with new capabilities under development, working as a part of Lucent we have the opportunity to more effectively meet the needs of the diverse set of ISPs and traditional service providers offering Internet service," he said. "This deal with Lucent is a natural fit -- our advanced technology and products and Lucent's unmatched experience as a high-quality supplier to large service providers."
O'Shea noted that the Internet industry will continue to see larger service providers entering the market or going for larger market share.
"These large network operators specialize in providing high-quality, highly-reliable communications networks," he said. "They are demanding that their equipment suppliers deliver systems that integrate into existing operations systems, that deliver cost-effective administration and maintenance support and that experience minimal downtime. The Lucent-Livingston combination will deliver on all of these critical customer requirements."
The purchase is expected to result in a one-time, non-cash charge against earnings. The charge involves an accounting writeoff assigned to in-process research and development and will be taken in the first fiscal quarter of 1998 assuming the transaction is closed by Dec. 31, 1997.
Excluding this one time charge, the purchase is expected to be slightly dilutive to earnings in the first year of operation and neutral by year two.
Livingston, a privately held corporation founded in 1986, markets products to more than 2,200 Internet Service Providers worldwide. The company's RADIUS(TM) software has become an industry standard for providing Internet access security, accounting and billing information, and network management.
Last year Livingston introduced the highly-reliable PortMaster 3 remote access concentrator, which integrates digital modem, router and communications server functionality with support for analog modems, ISDN, frame relay and leased line connections. The PortMaster 3 is based on Lucent's leading K56flex(TM) modem technology.
In addition to remote access concentrators, Livingston provides office routers and firewall routers that are resold by ISPs to corporate customers for Internet connectivity and other remote access networking applications.
In September, Lucent introduced an enhanced portfolio of intelligent switching, access and network management products as a part of its plan to dramatically improve data network performance.
As a part of its data networking portfolio, Lucent also offers industry-leading professional support services capability through NetCare(R)Services, a broad set of consulting, integration, management and maintenance services for multivendor data and video networks, voice systems and networks and call centers.
For more information on Livingston Enterprises, Inc., browse the company's home page at livingston.com.
Lucent Technologies designs, builds and delivers a wide range of public and private networks, communications systems and software, business telephone systems and microelectronics components. Bell Labs is the research and development arm for the company. More information about Lucent Technologies, headquartered in Murray Hill, N.J., is available on its Web site at lucent.com.
NOTE: There will be a media conference call at 1:30 p.m. Eastern time with Harry Bosco -- president of Lucent's Broadband Network Group. The call-in number is 1-800-288-8961.
CONTACT: Lucent Technologies, Murray Hill
John Callahan
908/953-5350 (office)
703/758-1449 (home)
johncallahan@lucent.com
or
Lynda Beighley
908/582-3060 (office)
201/635-7959 (home)
lbeighley@lucent.com
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