Wednesday June 3, 3:42 am Eastern Time
Tellabs to buy Ciena for $7.3bln-NYT
NEW YORK, June 3 (Reuters) - Telecommunication equipment maker Tellabs
Inc is buying competitor Ciena Corp for $7.3 billion in stock, the New
York Times reported Wednesday.
Citing people close to the deal, the Times said the two companies would
make an official announcement on Wednesday.
According to the Times, Ciena shareholders will receive one share of
Tellabs stock for each of their shares.
Ciena shareholders are expected to own roughly 35 percent of the
combined company, once a deal closes.
Takeover speculation drove the price of Ciena's stock price up $6.1875
in Nasdaq trading on Tuesday to close at $57.5625.
Tellabs stock rose just $0.0625 in Nasdaq trading Tuesday, closing at
$65.875.
The two companies have been caught up in the consolidation of the
telecommunications equipment industry, and have leveraged their
specialized technical knowledge to generate strong growth, the Times
wrote.
Tellabs reported $1.2 billion in revenue last year, compared to $494.2
million in 1994.
Savage, Maryland-based Ciena reported sales of 373.8 million in 1997.
The new company is expected to keep the Tellabs name and the
headquarters will remain in Lisle, Illinois.
Tellabs current chief executive officer Michael Birck will retain that
position with the new company, while Ciena's CEO, Patrick Nettles, will
become president and chief operating officer, the Times wrote. |
