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To: Tradelite who wrote (25932)	5/16/2000 8:50:00 AM
From: Tradelite	Respond to of 57584

story about Corvis.... ____________ Md. Telecom Firm Corvis Aims for $400 Million in IPO By Sarah Schafer Washington Post Staff Writer Friday, May 5, 2000; Page E03 Corvis Corp. of Columbia said yesterday that it will try for the Washington area's largest public offering in three years. The telecommunications company, already one of the most well-funded start-ups in recent history, hopes to raise $400 million in its stock offering, according to documents it filed with the Securities and Exchange Commission. Corvis designs products for building all-optical telecommunications networks that it says will slash the cost of transmitting voice and data traffic. Corvis's would be the largest public offering by a Washington area company since Bethesda-based USEC Inc. raised $1.4 billion in 1998. Corvis said it plans to use the proceeds of the offering to cover sales and marketing costs, as well as other expenses related to designing and building its products. The company has spent millions on research and development. "Optical networks are a completely new type of network," said Shyam Jha, Corvis's vice president of marketing. He and other company representatives would not give further details on the offering or the company, citing SEC rules regarding the "quiet period" before a stock offering. Its state-of-the-art technology could prove a double-edged sword for Corvis. Converting wire-based networks to optical systems could be costly, and its target customer base--mainly large telecommunications carriers such as MCI WorldCom Inc.--could be slow to warm to it. "In the carrier marketplace, innovation is accepted very slowly," said Chris Nicoll, an analyst for Current Analysis, a telecommunications research firm in Sterling. In the financial marketplace, Corvis could get short shrift because of the growing number of players in the optical networking market, which is expected to reach about $14 billion in sales in 2003. Lucent Technologies Inc. and Nortel Networks Corp. are just two of Corvis's many competitors. The market "is definitely crowded," Nicoll said. Since its inception three years ago, Corvis has generated much buzz in telecom circles, even though for a long time few people knew exactly what it was doing. Founder David Huber, who once described his work in the optical field as part of an arms race, kept details of his technology closely held. The company did not have a Web site until a year ago and for a while analysts had to sign non-disclosure agreements before receiving briefings from company officials. Still, Corvis was deluged with financing. As of April 1, Corvis had secured $346.1 million in venture capital and other funding. The company has not generated revenue. It has signed deals with two customers, Williams Communications Group Inc. of Tulsa and Broadwing Inc. of Austin. But each has agreed to purchase about $200 million of products and services from Corvis only after successful test trials. Huber owns 31.7 percent of Corvis. Other investors include venture firm Kleiner Perkins Caulfield & Byers of Menlo Park, Calif., and Cisco Systems Inc. of San Jose. The Corvis stock offering would be an encore performance by Huber. He founded Linthicum-based Ciena Corp. and brought the fiber-optic company public in 1997. Huber left Ciena--now a Corvis competitor--after a disagreement with the board of directors, taking $300 million worth of stock with him.