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

To: SJS who wrote (7910)	3/21/2000 3:38:00 PM
From: Jenne	Respond to of 24042

15:25 ET Lehman Portfolio : Lehman Brothers changes its model portfolio: removes Walmart (WMT) and American Intl Group (AIG); adds a 2% position in Citigroup (C), and boosts its positions in S1 (SONE) by 0.4%, America Online (AOL) by 0.8%, and JDS Uniphase (JDSU) by 0.2%.

To: SJS who wrote (7910)	3/21/2000 3:53:00 PM
From: Tecinvestor	Read Replies (1) \| Respond to of 24042

Correction of earlier post regarding DOJ scrutiny. Here's the url: quote.bloomberg.com And the story: Technology News Tue, 21 Mar 2000, 3:46pm EST JDS Uniphase's $18.6 Billion E-Tek Takeover Gets U.S. Scrutiny, People Say By James Rowley JDS Uniphase's E-Tek Buy Gets U.S. Look, People Say (Update5) (Updates stock prices in sixth paragraph.) Washington, March 21 (Bloomberg) -- U.S. antitrust enforcers are questioning whether JDS Uniphase Corp.'s proposed $18.6 billion acquisition of E-Tek Dynamics Inc. would hurt competition in the expanding market for fiber-optic components, say a customer and people familiar with the government's review. Justice Department lawyers have interviewed customers of E- Tek and JDS Uniphase, the world's largest maker of fiber-optic equipment parts, to determine whether the combined company would gain market power to raise prices on components that boost the capacity of fiber-optic networks, the people said. Lucent Technologies Inc., the largest U.S. telecommunications equipment manufacturer and both a competitor and buyer of products from the merging companies, acknowledged it has been questioned by the Justice Department over the telephone. Lucent officials ``didn't take a formal position' on the combination, said company spokesman Jeff Baum. JDS Uniphase is ``fully cooperating with the Justice Department and providing them with whatever information they require to evaluate the transaction,' said Mike Phillips, senior vice president of business development. ``They've worked pretty hard to understand this business, which isn't easy. We ultimately expect to get . . . approval, we're just unclear as to when.' JDS Uniphase and E-Tek make components of wave division multiplexers, which let telephone companies and Internet service providers send large amounts of traffic over fiber-optic lines. The technology combines the beams of different lasers on a single hair-thin strand of glass fiber. Shares of E-Tek, which fell as much as 21 3/4 in early trading, had dropped 1/4 to 238 by early afternoon on the Nasdaq Stock Market. Shares of JDS Uniphase, which also traded lower earlier in the morning, rose 1 1/4 to 122 5/8 in early afternoon trading on the Nasdaq Stock Market. JDS Uniphase shares were the sixth most actively traded in the U.S. this afternoon. Since reaching one-year highs on March 6, shares of JDS have fallen 16 percent and shares of E-Tek have fallen 21 percent. Demand Outstrips Production Demand for optical components is outstripping production for a market that analysts expect will increase to $23.1 billion in sales in 2003 from $6.7 billion last year, according to RHK Inc. The proposed acquisition would help JDS Uniphase obtain some of the added production capacity it needs to meet orders from customers such as Alcatel SA and Nortel Networks Corp. ``This is a pro-competitive combination that provides . . . benefit to customers in terms of increasing total industry capacity,' said Anthony R. Muller, chief financial officer of JDS Uniphase. Asked if the company is concerned that the Justice Department would view the combination as increasing market concentration, Muller said: ``There are some very complex market dynamics which we have described to the DOJ in our filings.' Muller said customer interviews are ```a very standard part' of an antitrust review, noting that the company was required to provide names and phone numbers of customers in its merger filing. Phillips said the Justice Department has not formally issued a second request for additional information, though the 30-day period for the government to do so has not yet lapsed. The company doesn't know whether to expect such a request, he said. Company officials declined to say when the merger application was formally filed with the Justice Department. There was no immediate comment from E-Tek or the Justice Department. JDS Uniphase has offered to exchange 2.2 shares of its stock for each share of E-Tek. E-Tek, which first sold shares to the public in December 1998, had sales of $172.7 million in the year ended June 30. Rapid Consolidation The Justice Department's review of the proposed merger comes amid rapid consolidation in the fiber-optics industry. Both JDS Uniphase and Corning Inc., the No. 1 manufacturer of glass fiber for telecommunications networks, have been buying fiber-optic businesses in an attempt to meet exploding demand. JDS Uniphase Corp., formed last July by the merger of Uniphase Corp. and Canada's JDS Fitel Inc., recently completed a $6.4 billion purchase of laser-filter maker Optical Coating Laboratory Inc., which makes filters for wave division multiplexers. Corning, which offered to pay $2.4 billion to acquire NetOptix Corp., another manufacturer of optical fiber. Corning also acquired the parts and cable business of Siemens AG. Uniphase made lasers used to beam information down optical fiber, while JDS Fitel competed with E-Tek in the manufacture of components for wave-division multiplexers. In the quarter that ended Sept. 30, JDS Uniphase reported $230.1 million in sales. It lost $113.9 million, or 68 cents a share, in that period, a performance that also reflects the cost of acquiring JDS Fitel.