MILAN, Italy, and LEHIGH VALLEY, Pa., July 25, 2008 -- Pirelli Group's photonics company, PGT Photonics, will merge with privately held optical components company CyOptics, the companies announced yesterday.

As part of the deal, Italian industrial group Pirelli will receive a 30 percent stake in the new company, which is expected to have annual revenues of about $80 million. Pirelli will also contribute $20 million in cash to the new business.

The companies said the agreement combines the complementary technologies of Lehigh Valley-based CyOptics' indium phosphide-based lasers and detectors with PGT's silicon-based photonics to create products such as wavelength tunable TOSAs, photonic integrated circuits (PICs), and other components aimed at improving flexibility and reducing the cost of optoelectronic communications.

For more information, visit: www.pirelli.com or www.cyoptics.com

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