Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Nortel Networks (NT) -- Ignore unavailable to you. Want to Upgrade?

To: Kenneth E. Phillipps who wrote (6561)	8/15/2000 9:13:04 AM
From: Alastair McIntosh	Respond to of 14638

TORONTO, Aug 15, 2000 (The Canadian Press via COMTEX) -- Nortel Networks Corp. has come up with another blockbuster acquisition, agreeing to buy California-based Sonoma Systems - a leader in high-speed video, data and voice communications - for up to $540 million US in Nortel shares. Nortel said Tuesday the deal will enable it to tie the power of the high-performance optical Internet to the access solutions of the local Internet. "This will allow service providers to deliver high-speed managed services to their business customers," Nortel said in a release. "The Yankee Group estimates that the market for delivering these carrier-managed services will reach more than $18 billion US globally by 2002, up from $10 billion US this year." Sonoma Systems' access devices allow service providers to extend new services to business customers, including high-speed local Internet access, video services and Internet telephony. Sonoma has its headquarters in Marina del Rey, Calif., a technology centre in Marlborough, Mass., and sales and support offices throughout North America and in the United Kingdom. "We are taking our leadership in the high-performance optical Internet and extending it to the local Internet," said Steve Schilling, president of access networks at Brampton, Ont.-based Nortel. Under an existing deal, Sonoma Systems network management capabilities have already been wed to various Nortel systems. "Nortel Networks is leading the charge in delivering the high-performance Internet," said Gregory Koss, chief executive of Sonoma Systems. Of the purchase price, an estimated $480 million US will be paid in Nortel shares. Up to $60 million more in shares is payable subject to the fulfilment of certain business performance objectives in the first year after closing. The acquisition, which is expected to close in the fourth quarter of 2000, is subject to customary regulatory and Sonoma shareholder approvals. Nortel said the acquisition, excluding costs, is expected to be neutral in calendar year 2000 and a slight boost to earnings in calendar year 2001. Nortel is a global Internet and communications leader with 1999 revenues of $21.3 billion US. The online source for news sports entertainment finance and business news in Canada Copyright (C) 2000 The Canadian Press (CP), All rights reserved