Optium to Acquire Kailight Photonics
HORSHAM, Pa., March 28, 2007 -- Optium Corp., a supplier of high-performance optical subsystems for the telecom and cable TV industries, announced it has entered into a definitive agreement to acquire Kailight Photonics Inc., a maker of 40 Gb/s optical transmission products.
The total purchase price for the acquisition will be approximately $35 million in cash at closing, including payment for all outstanding capital stock and vested in-the-money stock options, as well as the payment of Kailight stockholder indebtedness and employee change-of-control awards, Optium said.
Kailight's optical modules are 300-pin 40 Gb/s transceivers addressing line-side and client-side applications. They include integrated PMD (polarization mode disperson) compensation and multiple modulation formats.
Optium said the acquisition will expand its optical transport line, which features fully wavelength agile DWDM, SONET and 10 Gigabit Ethernet transceivers and subsystems, 10 Gb/s pluggable transceivers, CATV trunking and distribution subsystems and Optium's WSS ROADM product line. In said it will also enable it to provide line-card solutions for all variations of 40 Gb/s applications.
Optium said Kailight's 40 Gb/s technology is expected to be a factor in the transition from custom line-card solutions to module-based solutions and to provide a cost-effective path for customers to migrate to next-generation modulation formats. Kailight transceivers have been qualified with several system integrators and have begun shipping in preproduction quantities.
Sagie Tsadka, president and CEO of Kailight, said, "We believe that the combined strength of the two companies will optimize Kailight's next-generation 40-Gb/s technologies and intellectual property by leveraging Optium's proven skills in bringing advanced technologies to market as well as its strong customer relationships. We look forward to being a part of the Optium team and realizing our combined product vision."
Eitan Gertel, chairman and CEO of Optium, said, "The combination of Optium's product lines and Kailight's 40 Gb/s product line will immediately enhance the value we bring to our customers. It represents another step in our commitment to supply best in class, core-to-the-edge optical transmission solutions and is consistent with our strategy to target the fastest-growing segments of the optical transport market."
Optium said it will assume all of Kailight's out-of-the-money stock options as well as its unvested stock options. In addition, it will be obligated to pay up to an additional $5 million to current holders of Kailight capital stock and in-the-money stock options based on the acquired business reaching certain milestones through Optium's second fiscal quarter of 2009. The acquired business is expected to contribute to earnings early in calendar year 2008. The acquisition is expected to close within the next 45 days, subject to customary closing conditions and regulatory approvals.
Kailight had announced a $4.5 million funding round in January (See: "Kailight Photonics Funding Round Raises $4.5M for TASR Line" ) to support the manufacture and sales of the its tunable all-optical signal regenerator products and to help launch several new products.
- The technology of generating and harnessing light and other forms of radiant energy whose quantum unit is the photon. The science includes light emission, transmission, deflection, amplification and detection by optical components and instruments, lasers and other light sources, fiber optics, electro-optical instrumentation, related hardware and electronics, and sophisticated systems. The range of applications of photonics extends from energy generation to detection to communications and...
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