Terayon Acquires Tyco Electronics' Access Network
Electronics Division for Presence in U.S. DSL Market
Expands Terayon's Market Opportunity to Deliver DSL-Based Voice &
Data Systems
SANTA CLARA, Calif.--(BUSINESS WIRE)--Feb. 3, 2000-- Terayon Communication Systems, Inc. (Nasdaq: TERN - news) today
announced a definitive agreement to acquire Raychem Access Network Electronics (ANE), a division of Tyco Electronics Corporation, a
subsidiary of Tyco International Ltd. (NYSE: TYC - news). Terayon, a leading supplier of broadband network systems, plans to acquire
ANE, the U.S. market leader in DSL (Digital Subscriber Line) systems that provide multiple phone lines over the existing copper
telephony network. The addition of ANE to Terayon's current DSL business unit provides Terayon with a strong customer presence in the
key U.S. communications market.
ANE's customers include all the major U.S. ILECs (Incumbent Local Exchange Carriers), including SBC, Bell Atlantic, Bell South, U.S.
West, and GTE. With the explosion of the Internet, these and other U.S. carriers have experienced unprecedented demands to provide
incremental bandwidth to support a host of voice and data services. ANE has addressed this market opportunity by delivering advanced
digital carrier systems, which they have successfully marketed to all the major Bell operating companies and independent telephone
operators via their strong nationwide sales and support network. ANE's broad DSL product portfolio, combined with their focused sales
and customer support network, has allowed them to establish a market-leading position in the voice DSL market, with over 500,000 DSL
lines installed.
Terayon CEO Zaki Rakib stated, ``We are very excited about the acquisition of ANE, which further reinforces Terayon's ability to deliver
the most advanced broadband voice, data, and video services over multiple access media -- from cable to DSL.'
Adoram Gaash, Senior Vice President and General Manager of Terayon's Integrated DSL Business Unit, added, ``ANE's strong market
presence in the U.S., solid customer relationships, and reputation for service quality makes them an excellent complement to Terayon's
growing broadband family. Combined with the recent acquisition of Radwiz for integrated DSL systems technology, ANE provides the
market presence and scale to make Terayon a serious player in the growing U.S. DSL market.'
Erwin De Bruycker, General Manager of Access Network Electronics, stated, ``We are pleased to become part of Terayon's growing
presence in the broadband market. The combination of ANE with Terayon's solid DSL technology base will allow us to market an
integrated voice and data DSL solution throughout the world.'
The acquisition of ANE is a key step in Terayon's strategy to assemble complementary solutions for delivery of broadband voice, data, and
video over a variety of media--from cable to DSL. The company anticipates significant technological and operational synergy between ANE
and Terayon's DSL business unit, following its recent acquisition of Radwiz Ltd. Terayon's Integrated DSL business unit produces the
IPTL (IP To The Loop) product family of DSL-based access systems for the SOHO (Small Office/Home Office) market. Terayon's DSL
technology and expertise, combined with the ANE customer base and market footprint, position Terayon well in the growing broadband
DSL market.
Under terms of the agreement, Terayon common stock worth approximately $90 million will be exchanged for all outstanding shares of
ANE. The acquisition will be accounted for as a purchase and is expected to close in the second quarter of Terayon's fiscal year 2000. This
acquisition has been approved by the board of directors of each company and is subject to various closing conditions.
Terayon Communication Systems provides innovative broadband networking solutions for advanced broadband voice, data and video
services. The company's cable data access systems, digital video systems, and broadband telephony systems are deployed by leading cable
operators worldwide. The company's xDSL access systems deliver innovative telephony and data solutions for the growing SOHO
business market. Terayon, based in Santa Clara, California, USA, has sales and support offices worldwide, and is traded on the Nasdaq
under the symbol TERN. Terayon can be found on the web at www.terayon.com.
Tyco Electronics Corporation is the leading passive electronic component supplier in the world. Access Network Electronics (ANE) is the
leading supplier of high performance electronic digital subscriber-line multiplexer systems for telephone access networks. With more than
500,000 DSL access systems installed in North America, the ANE division provides high quality, cost effective solutions for all the
Regional Bell Operating Companies and independent telephone operators. Information on ANE is available on the Internet at
www.raychem.com/ane.
``Safe Harbor' Statements under the Private Securities Litigation Reform Act of 1995: Except for the historical information contained
herein, this news release contains forward-looking statements, estimates, and assumptions by the Company and other parties that involve
risks and uncertainties, including the Company's ability to gain new business, the expansion of operations by the Company's customers
and the deployment of the Company's products in specific markets, as well as the other risks detailed from time to time in the Company's
filings with the SEC.
Note: Terayon, the Terayon logo, TeraPro, TeraLink, and TeraComm are registered trademarks of Terayon Communication Systems, Inc.
TeraView and CherryPicker are trademarks of Terayon Communication Systems, Inc. All other trademarks are property of their respective
owners.
Contact:
Terayon Communication Systems
Investor Contact:
Ray M. Fritz, 408-919-5806
email: rfritz@terayon.com
Press Contact:
John Hamburger, 408-486-5273
email: johnh@terayon.com |
