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 : Newbridge Networks -- Ignore unavailable to you. Want to Upgrade?

To: Dief who wrote (5203)	6/15/1998 11:13:00 PM
From: pat mudge	Respond to of 18016

Another BAY-NT merger article, this time from Financial Times: <<< TUESDAY JUNE 16 1998ÿÿTelecomsÿ Northern Telecom buys Bay Networks By Christopher Price in San Francisco and Scott Morrison in Toronto <Picture: Nortel>Northern Telecom, of Canada, on Monday became the latest telecommunications equipment group to enter the data networking market with an agreed US$9.1bn all-share deal to buy Bay Networks, of the US. The move ended weeks of speculation over the future of Bay, which had been struggling to keep pace in the fiercely competitive market. It recently appointed Morgan Stanley, the US investment bank, to explore its options. The deal is the third in as many weeks in which telecoms equipment groups have entered data networking through acquisition. Two weeks ago, Tellabs, a US telecoms equipment group, paid $7.1bn to acquire Ciena, a US data networking company. This was followed by a $4.4bn takeover of DCS Communications, another US networking group, by France's Alcatel Alsthom. Networking groups, which provide the technology to link and manage computer systems, have become increasingly important as the movement of data outpaces traditional voice telephony traffic, driven by the use of the internet. John Roth, chief executive of Northern Telecom, Canada's biggest telecoms group, said: "Data traffic is growing at between 30 per cent and 40 per cent a year and the internet is a big part of that. New integrated internet protocol networks will drive this growth and we are the first company of its kind to be able to do that." The enlarged group will have revenues of more than $18bn and employ 80,000 people. Dave House, chairman and chief executive of Bay, will become president of Northern Telecom. The US company will continue to trade as a wholly owned subsidiary of Northern Telecom. The deal was based on Friday's closing price of $63.69 for Northern Telecom, and valued Bay at $38.21 a share. At mid-session in New York yesterday, Northern Telecom shares had fallen more than 12 per cent to $55 9/16. Bay shareholders will receive 0.6 of a Northern Telecom ordinary share for each Bay share they own. After the deal, Bay shareholders will hold 21 per cent of Northern Telecom. Bell Canada, Northern's controlling shareholder, will see its interest drop from 51 per cent to 41 per cent. Lucent Technologies, the US telecoms equipment group, was also seen as a possible bidder for Bay. The networking group has extensive agreements with Lucent, but Mr House said he did not know how the relationship between the two groups would develop.>>>