FREMONT, Calif., August 22 -- Avanex Corp., a provider of photonic processing solutions that enable optical communications networks to achieve next-generation performance, announced it has entered into an agreement to acquire certain assets of Vitesse Semiconductor Corp.'s Optical Systems Division, located in San Jose, Calif. Under the agreement, Avanex will acquire substantially all of the assets of Vitesse's Optical Systems Division in exchange for approximately 1.2 million shares of Avanex common stock. Based on the closing price of Avanex's stock on August 19, the transaction has a value of approximately $6 million. Under the terms of the agreement, Avanex will also buy up to $2 million in products from Vitesse over the next three years. The completion of the transaction is subject to customary closing conditions. Walter Alessandrini, chairman, president and CEO of Avanex, said, "The acquisition of this business will enhance our already strong presence in transponders and expand our customer traction in subsystem products. Avanex will have a competitive cost structure by leveraging the world-class component capabilities we acquired this year from Alcatel and Corning. In addition, through our future relationship with Vitesse, a leader in high-speed communication integrated circuits, we believe that Avanex will have a significant advantage in developing intelligent solutions that integrate optics, electronics, firmware and software." For more information, visit: www.avanex.com