JDS buying IBM optical business

Fibre optic components maker JDS Uniphase Corp. announced Thursday that it is purchasing a piece of IBM Corp. that specializes in optical transceiver technology.

According to the Ottawa-based network equipment vendor, the $340 million acquisition will allow it to offer products to customers in the enterprise and networking markets, including small form factor transceivers, Gigabit interface converters for storage area networks and equipment for Fibre Channel and Gigabit Ethernet LAN-based technology.

In a prepared press statement, Jozef Straus, JDS Uniphase co-chairman, president and chief executive officer, said with the acquisition, the company can “offer enterprises . . . improved network flexibility, capacity, reach, reliability and cost through advanced fibre optic components and modules.”

Most of IBM’s transceiver business operates in Rochester, N.Y., and services long haul and short reach carrier and enterprise customers.

JDS Uniphase disclosed a loss of $7.9 billion for last year’s fiscal fourth quarter and laid off nearly 16,000 employees last year.

The year “began as a period of rapid expansion for JDS Uniphase but concluded with a severe industry downturn,” said Jozef Straus, the company’s president, CEO and co-chairman, at the time.

But more recent, encouraging forecasts from some of the network equipment industry’s biggest vendors, including JDS, are sparking optimism among some observers that the sector’s long winter may soon be over. In late September the company reported that it would hit its $325 million target for the first fiscal quarter.

Earlier this year Boston-based The Yankee Group Inc. recently issued a report claiming that “carriers’ efforts to meet increased demand are starting to pay off, and they have begun to examine their network architectures.”

JDS Uniphase is online at http://www.jdsu.com.

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