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JDSU buys IBM unit
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December 19, 2001: 5:11 p.m. ET
JDS Uniphase buys IBM unit, enters data communications market.
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NEW YORK (CNN/Money) - Optical networking company JDS Uniphase Corp. announced a deal Wednesday to buy an optical component business of IBM Corp. for up to $425 million in an effort to tap the data communications market.
JDSU (JDSU: Research, Estimates) will initially pay $100 million in cash and $240 million in stock for IBM's optical transceiver business, with additional payments of up to $85 million in cash and stock made in early 2003.
Optical transceivers have both an optical transmitter and an optical receiver, allowing two-way communications between two end points.
Jeff Wild, a spokesman for JDSU, said acquiring IBM's (IBM: Research, Estimates) optical transceiver business will enable the company to offer products for storage area networks and serve such clients as Compaq, Brocade and Hewlett-Packard.
We primarily are concentrating on the telecommunications market," Wild said. "What this will allow us to do is get into data communications business."
The deal will be subject to regulatory approval.
Shares of JDSU fell 3 cents to $8.37 after hours. 
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