Tellabs Inc. (Quote), a Naperville, Ill.-based telecommunications equipment firm, said it has completed its $355 million cash-and-option buy of next-gen optical-gear supplier Ocular Networks.
The completion of the Ocular acquisition follows Tellabs' receiving all necessary government approvals, officials said.
Tellabs said it will retain the Reston, Va., office location for employees who are developing the Tellabs 6400 series of transport switching products. Ocular Networks will now be the Tellabs Metro Networking Group led by Ed Kennedy, senior vice president, who will report to Richard C. Notebaert, president and chief executive officer of Tellabs.
Other changes related to the acquisition include the creation of a new department for product strategy and portfolio management
Tellabs, which said late last year that it would reduce its work force by about 1,000 people, said the acquisition would expand its market by up to $5 billion in 2003 and up to $9 billion in 2005. In terms of business, Tellabs said the purchase combines Ocular's next-generation technology with its customer relationships, distribution channels, customer service and field support.
Through this acquisition, Tellabs adds three new products to augment its portfolio of digital cross-connect and transport switching systems, helping customers lower costs and speed revenues. The buy brings to Tellabs a new 6400 line of products, which increases network utilization efficiency in Tier 2 and Tier 3 offices. The new Tellabs 6400 transport switching line of products helps carriers open new revenue streams from Ethernet over SONET (synchronous optical network), and dramatically lower capital and operating costs.
The 6400 line includes a transport switch (formerly known as the Ocular OSX-6000), an edge node (formerly the Ocular OSX-1000) and a element manager (formerly the Ocular MetroWatch).
Tellabs' 6400 transport switching products support key wireline and wireless customer applications by extending SONET wideband and broadband digital cross-connect system functionality into Tier 2 and Tier 3 offices and points of presence (POPs).
Besides its layoffs, Tellabs had said it added resources to accelerate development of its Titan 6100 dense wavelength division multiplexing product, while at the same time it discontinued development of the Titan 6700 core optical switch.
With the changes, Tellabs had said it would record restructuring and one-time charges of about $150 million in its fourth quarter of 2001. The charges are expected to include restructuring charges of $26 million, inventory-related charges of $85 million and other asset-related charges of $39 million.
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