NEC Corp. of Tokyo has announced that it will divest its optical semiconductor and microwave silicon and compound semiconductor operations. It plans to form a new company from the operations in October and will hold an initial public offering within two years of its inception.

Headquartered in Tamagawa, Japan, the new company will have a staff of 500 and will continue to develop technologies for wavelength division multiplexing systems. NEC believes that the move will triple the sales of optical and microwave devices for the operations by 2005, compared with a predicted doubling of the market in that time.