Thursday, December 2, 2021

Furukawa gets Lucent fibre unit for less and cuts jobs

Lucent Technologies Inc. and Japanese telecommunication cable maker Furukawa Electric Co. Ltd. have reached an agreement whereby Lucent will sell its optical-fiber unit to Furukawa and U.S. company CommScope Inc. for US$2.3 billion, of which CommScope’s share will be $173 million, Furukawa announced Friday.

Furukawa, after the acquisition, will take over all 4,200 employees from the unit and expects to cut jobs there, the company said.

Talks between the two companies and broadband coaxial cable maker CommScope started early this year, and in July, Lucent and Furukawa were ready to settle with a $2.5 billion deal.

CommScope, however, failed to raise its $650 million share, and requested that Furukawa reduce CommScope’s stake in the partnership. Furukawa then persuaded Lucent to reduce the originally agreed price in return for Furukawa increasing its share, said Nobuyuki Kishi, a spokesman for Furukawa.

The deal has been signed and is to be completed at midnight Saturday Japan time, Kishi said.

The unit will be divided into two operational companies, one focusing on optical fibre and the other on optical cable. A third joint-venture company will be formed to oversee operations. Furukawa will have an 81.6 per cent stake and CommScope an 18.4 per cent stake in the optical-cable company and Furukawa would wholly own the other two.

Lucent Technologies, based in Murray Hill, N.J., can be reached at http://www.lucent.com/. Furukawa Electric, in Tokyo, is at http://www.furukawa.co.jp/. CommScope, in Hickory, N.C., is at http://www.commscope.com/.

Would you recommend this article?

Share

Thanks for taking the time to let us know what you think of this article!
We'd love to hear your opinion about this or any other story you read in our publication. Click this link to send me a note →

Jim Love, Chief Content Officer, IT World Canada

Related Tech News