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Technology Stocks : JDS Uniphase (JDSU) -- Ignore unavailable to you. Want to Upgrade?

To: quidditch who wrote (1188)	10/5/1999 7:20:00 AM
From: Glenn McDougall	Read Replies (1) \| Respond to of 24042

Soaring JDS lands firm in $400M coup By KEVIN BELL, Ottawa Sun JDS UNIPHASE Corp., the Microsoft of the fibre-optical world, got a bit bigger yesterday when it snapped up a New Jersey firm for a cool $400 million US. The company announced it is acquiring Epitaxx Inc. to add its fibre-optic detectors and receivers to JDS's portfolio of products. The company will pay $400 million in JDS common stock to the owners of Epitaxx, whose majority holder is a subsidiary of Nippon Sheet Glass Co. The deal immediately got the strong approval of investors and analysts. JDS shares jumped $13, or 7.6%, to close at $183 on the Toronto Stock Exchange. Chief executive Kevin Kalkhoven said the acquisition will fill a hole in JDS Uniphase's product portfolio. But he downplayed the acquisitions' effect on JDS Uniphase's already spectacular revenue growth rate of 90%. Epitaxx's revenues of $40 million will represent just 5% of the combined company's sales, he said. "It allows us to maintain the growth rate, but it would be a little bit unfair to say it accelerates the growth rate," he said. But Patrick Houghton, an analyst for Sutro & Co., said the deal has provided an immediate shot in the arm for JDS. "They have the uncanny way of acquiring companies at the right time and this may be another case of that." Houghton said JDS already dominates the market in most fibre-optic telecommunications products, but was not a market leader in providing receivers or transmitters capable of sorting out the various colours at high bandwidth. "And that's what they're buying with Epitaxx." JDS stock was trading at about 20 times revenues, and it's buying a company that is priced at just 10 times revenues, he said. The deal will cement JDS's place in the fastest growing segment on the telecommunications business. "I'm surprised they got it so cheap, frankly," he said. "This deal should be immediately accretive. I think they're going to see continued growth." The merger is expected to close by the end of November as long as it receives government approval, including a green light from U.S. anti-trust watchdogs. JDS Uniphase was dubbed the Microsoft of the optical world last year when it was formed through the merger of JDS Fitel of Nepean and Uniphase Corp. of San Jose, Calif.

To: quidditch who wrote (1188)	10/7/1999 12:23:00 PM
From: Beltropolis Boy	Read Replies (1) \| Respond to of 24042

>re. the SDLI rumor on today's acquisition. Odd that SDLI wouldn't have run hard to put it together, as the fit seems so natural for either one. Both SDLI and JDSU have very appreciated currency to play with.< on that note, here's KK on SDLI (and ETEK): "They ought to be sending me flowers," jokes Kalkhoven. "Every time we do a deal, their stocks go up." ----- TheStreet.com Oct 6, 1999 JDS Uniphase Eyes Acquisitions in Optical Technology Industry By Kevin Petrie Staff Reporter SAN FRANCISCO -- Hustling to keep the lead in the fast-moving optical network industry, JDS Uniphase (Nasdaq:JDSU) is using its powerful stock currency to acquire new technologies. On Monday, the San Jose, Calif.-based supplier of optical-fiber network instruments said it would purchase Epitaxx in a stock swap valued at $400 million. While hardly a big chunk of JDS Uniphase's $21.7 billion market cap, the transaction offers insight into the company's growth strategy. JDS Uniphase said Epitaxx will add only about 5% to its revenue, which totaled $282.8 million in the year through June. But Epitaxx's equipment for testing the flow of light through glass will fit snugly with JDS Uniphase's current offerings. Expect more deals like this, says Kevin Kalkhoven, CEO of JDS Uniphase. The company will keep bolstering both its engineering talent and its offerings for customers, such as network suppliers Alcatel (NYSE:ALA) and Ciena (Nasdaq:CIEN). The aim: Buy the best before anyone else gets there and become the broadest merchant supplier of optical components around. "Nothing is off the table," Kalkhoven says of potential acquisitions. He wouldn't talk about specific acquisition plans, but he's eyeing the 40 to 50 optical start-ups operating worldwide as well as his publicly traded peers. The fast-growing optical-component industry is rapidly consolidating as companies strive to achieve economies of scale. And JDS Uniphase is in the strongest position to cherry-pick the best acquisitions. Following the July merger of JDS and Uniphase, the company is the biggest in its niche. The stock of the combined companies has risen tenfold since early 1997. And it raised $600 million in a stock offering just weeks after the merger closed. The strategy has investors ferreting around for the next targets. JDS Uniphase's announcement Monday sent its stock up 8% to a record close of 125. The stocks of its smaller peers SDL (Nasdaq:SDLI) and E-Tek (Nasdaq:ETEK) jumped 5 5/8 to 82 3/4 and 3 3/16 to 56, respectively. "They ought to be sending me flowers," jokes Kalkhoven. "Every time we do a deal, their stocks go up." JDS Uniphase excels at hiring and acquiring brainpower, says Mark Graf, who heads up North American business development for optical supplier Altitun of Sweden. Graf wouldn't say whether JDS Uniphase might want to buy his company, but he sees the advantage of linking with a more established company. "It would be very difficult to do it alone." Analysts agree that the smaller fry will get eaten up. "You can't play small," says analyst Chris Crespi with Banc of America Securities, which has acted as investment banker for JDS Uniphase. He rates JDS Uniphase at buy. Epitaxx itself balked at going it alone, abandoning its plans to issue public stock in spring 1998. Who's next for JDS Uniphase? According to an equity analyst who asked not to be named, the company might benefit from snapping up CoreTek, a developer of network lasers in Wilmington, Mass., that received $6 million in funding in February from Adams Capital Management and other backers. Another candidate is Lasertron, a unit of Oak Industries (NYSE:OAK) in Waltham, Mass., even though it recently lost business and prompted Oak to preannounce disappointing results for the September quarter. Officials at CoreTek and Oak didn't immediately return calls for comment. Kalkhoven says cagily that those companies, as well as Altitun, are "in the right area." And he's got all that money to spend.