(NT) 48 7/8: telecommunications equipment maker to acquire Cambrian Systems, a privately-held company and developer of technology to speed the flow of network traffic between metropolitan areas and the optical Internet backbone, for $300 mln in cash
press release:
Nortel Networks to Acquire Cambrian Systems for up to US $300 Million
PR Newswire - December 09, 1998 07:45
Leading Edge Optical Technology Will Speed up On-Ramps to the Internet
TORONTO, Dec. 9 /PRNewswire/ - Nortel Networks (NYSE: NT/TSE:NTL) announced today an agreement to acquire Cambrian Systems Corporation, a privately-held company based in Kanata, Ontario, which has developed an innovative technology to speed the flow of network traffic between metropolitan areas and the optical Internet backbone.
Nortel Networks will pay up to US $300 million in cash for Cambrian Systems, a portion of which will be deferred and paid contingent upon Cambrian Systems achieving certain business objectives. The acquisition is expected to close within 30 days, and comes three months after the acquisition of data networking leader Bay Networks.
''This is another investment in our strategy to usher in a new era of networking. With the acquisition of Cambrian Systems, we're speeding up the on-ramps to the Internet backbone,'' said John Roth, vice chairman and chief executive officer, Nortel Networks. ''By eliminating the bottleneck between metropolitan networks and the high-speed fiber optic backbone, we will enable higher speeds and higher reliability with bigger bandwidth and lower cost networking.''
Nortel Networks will combine its optical technology with Cambrian Systems' OPTera product line to deliver the first ring-based D-WDM (Dense-Wavelength Division Multiplexing) solution for metropolitan applications. The metropolitan area network (MAN) refers to the links between carrier switching centers, Internet service providers, and corporate networks. The new ring-based technology provides unmatched reliability and performance, with cost benefits as high as 30 percent. This technology bridges the metropolitan network centers to the optical core, pushing optical networking to the edge of the network.
''This technology and product portfolio redefines the MAN,'' said Roth.
Nortel Networks is already a leader in the optical core of the world's networks, with fiber optic technology that moves data at speeds of up to 320 gigabits per second (Gbps). Nortel Networks is also a leader in the enterprise wide area network (WAN) with category-leading products including the Passport multi-service switch and the Accelar routing switch. The Cambrian Systems technology bridges the WAN and the core creating a broad range of high-speed solutions unmatched by any competitor. In addition, OPTera works with all major protocols, including Internet Protocol (IP), ATM and voice, giving customers new flexibility and an additional way to cut costs.
Leadership at the Core and in the WAN
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Nortel Networks leads in the core backbone market with:
- 90 percent market share in 10 Gbps fiber optic transmission systems;
- 75 percent of backbone Internet traffic is carried on optical networks by Nortel Networks;
- 45 percent revenue growth in Broadband Networks in the third quarter;
- six out of seven pan-European Internet backbones supplied by Nortel Networks.
Nortel Networks leads in the enterprise WAN market:
- No. 1 in the WAN enterprise switch market;
- No. 1 in WAN enterprise frame relay switch market;
- No. 1 in WAN enterprise ATM switch market;
- No. 1 in Layer 3 switching with Accelar.
''Combined with our optical networking solutions, our unique routing capabilities, and our access technologies, Cambrian Systems' metropolitan area technology is another piece in our strategy to deliver next-generation Unified Networks,'' Roth said. ''Unified Networks deliver high-speed communications for all our customers, including service providers, enterprises, and home Internet users. We are delivering Unified Networks today to a variety of customers.''
Cambrian Systems will benefit from Nortel Networks' worldwide distribution, quality of service, and brand name in reaching the global market with the OPTera. ''This acquisition is about the acceleration of sales with the best combined team centered on a shared vision for open, survivable optical internetworking,'' said Don Smith, president, Cambrian Systems.
Cambrian Systems, with approximately 170 employees primarily based in Canada, will continue to be based in Kanata, Ontario, with additional resources from Nortel Networks Optical Network Applications business. |
