SAN JOSE, Calif. &
FREMONT, Calif., March 26, 2012 /PRNewswire/ -- Oclaro, Inc.
(Nasdaq: OCLR), a tier-one provider and innovator of optical
communications and laser solutions, and Opnext, Inc. (Nasdaq:
OPXT), a global leader in the design and manufacture of optical
modules, components and subsystems, today announced that they have
entered into a definitive agreement to merge in an all-stock
transaction. Under the terms of agreement, Opnext
shareholders will receive a fixed ratio of 0.42 shares of Oclaro
common stock for every share of Opnext common stock they own.
The Oclaro and Opnext merger is expected to mark a major
transformation in the optical industry, bringing together over 30
years of combined telecom and datacom optical technology
innovation. The merger will create a new industry leader in
the fast-growing optical components and modules market, forecast to
reach $9.2 billion in 2015.[1] The
broad product portfolio, technology innovation, engineering
resources, cost structure and strategic customer relationships of
the combined company are expected to expand its opportunities for
growth and to create long-term shareholder value.
Data-intensive applications such as video and cloud computing,
and the proliferation of mobile devices, are driving the need for
increased performance and bandwidth throughout the core optical
networks, at the heart of the world's Internet traffic. These
trends are also forcing enterprises and data centers to upgrade and
deploy new data communications infrastructures.
As a result, traditionally separate telecom and datacom networks
are converging, leveraging advanced optical networking technologies
from companies such as Opnext and Oclaro. The combined
company will be well positioned to capitalize on these trends to
become the No. 1 supplier to the core optical networks with a
strong leadership position in the fastest-growing 40G and 100G
segment, which is expected to grow at a CAGR of 42% through
2015[2]. The broader product line resulting from the merger
strengthens the combined company's position as a key supplier to
existing and new customers.
"This merger clearly will be a unique and transformational
opportunity for both Oclaro and Opnext," said Alain Couder, chairman and CEO, Oclaro.
"Our respective customers want to work with fewer, more strategic
suppliers who can deliver the breadth of technologies they need.
Through this merger, the companies' complementary and
vertically-integrated product portfolios, scale, and heritage of
technology innovation will put the merged company in that valued
strategic partner and leadership role. By doing so, and at
the same time saving significant costs, we also expect to generate
substantially more long-term value for shareholders than either
company could deliver alone."
In addition to the telecom and datacom markets, there is a large
and growing opportunity for laser diodes in a range of high-growth
industrial and consumer markets. Through this transaction,
the combined company will be the largest supplier of laser diodes
for industrial and consumer applications. With a substantial
portfolio of products and technologies, the combined company is
well positioned to accelerate innovation and inroads into these
high-volume markets.
The combined heritage of Oclaro and Opnext comes from some of
the leading optical technology innovators over more than 30 years,
including Hitachi, Nortel, Alcatel, Marconi, Corning, Opnext,
Bookham and Avanex.
"Opnext and Oclaro share a rich history bringing to market some
of the industry's most advanced optical technology innovations over
more than three decades," said Harry
Bosco, chairman and CEO, Opnext. "I am excited by the
unique opportunity that will be created by this combination for
customers, shareholders and for the employees of the merged
company, who will leverage this deep legacy of technology
innovation to lead the optical components and modules market and to
achieve critical mass in the industrial and consumer laser diode
segments."
The combined company will be led by Alain Couder, who will serve as chairman and
CEO. Upon closing, Harry Bosco will
join the combined company's board of directors.
Transaction Details
Upon the close of the transaction, Opnext shareholders will own
approximately 42% of the combined company.
The combined company is expected to achieve positive non-GAAP
operating income in the first full quarter after the close and is
expected to achieve annualized cost synergies of $35 million to $45 million within 18 months of
the close of the transaction. The company expects restructuring and
system integration costs to total $20
million to $30 million.
The transaction is subject to customary closing conditions,
including approval by the shareholders of both companies and the
receipt of regulatory approvals in the U.S., and is expected to
close within three to six months.
Oclaro and Opnext will each be filing the full text of the
merger agreement with the Securities and Exchange Commission (the
"SEC") on Form 8-K within four business days of the date of this
release. Investors and security holders of each company are
advised to review those filings for the full terms of the proposed
combination, as well as any future filings made by the companies,
including the Form S-4 Registration Statement and related Joint
Proxy Statement/Prospectus. (See below under "Additional
Information and Where to Find It").
Conference Call
The management teams of both companies will host a conference
call today, March 26, 2012, at
5:00 p.m. ET/2:00 p.m. PT. To access the conference
call, please dial 1-480-629-9760. A live webcast and
accompanying presentation of the conference call will be available
in the Investors section of Oclaro's website at www.oclaro.com and
in the Investors section on Opnext's website at
www.opnext.com. A joint slide presentation to be used in the
conference call will be filed by each company with the SEC and
posted to the investor relations page of each company's website
prior to the conference call. An audio replay of the
conference call will be available until April 2, 2012, 11:59 pm
Eastern Time. To access the replay, please dial
1-858-384-5517 with pin 4527215.
About Oclaro
Oclaro, Inc. (NASDAQ: OCLR) is a tier-one provider and innovator
of optical communications and laser components, modules and
subsystems for a broad range of diverse markets, including
telecommunications, industrial, scientific, consumer electronics
and medical. Oclaro is a global leader, dedicated to
photonics innovation with cutting-edge research and development
(R&D) and chip fabrication facilities in the U.S., U.K.,
Italy, Switzerland, Israel, Korea and Italy, and in-house and contract manufacturing
sites in China and Thailand, with design, sales and service
organizations in most of the major regions around the world. For
more information, visit http://www.oclaro.com.
About Opnext
Opnext (NASDAQ:OPXT) is the optical technology partner of
choice supplying systems providers and OEMs worldwide with one of
the industry's largest portfolios of 10Gbps and higher next
generation optical products and solutions. The Company's industry
expertise, future-focused thinking and commitment to research and
development combine in bringing to market the most advanced
technology to the communications, defense, security and biomedical
industries. Formed out of Hitachi, Opnext has built on
more than 30 years of experience in advanced technology to
establish its broad portfolio of solutions and solid reputation for
excellence in service and delivering value to its customers. For
additional information, visit www.opnext.com.
Forward-Looking Statements
This press release, including statements by management, contain
statements about management's future expectations, plans or
prospects and its business, and together with the assumptions
underlying these statements contains forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. Such statements include, but are not limited to: (i)
statements about the benefits of the merger involving Oclaro and
Opnext, including potential synergies and cost savings and the
timing thereof; (ii) future financial and operating results
following the merger; (iii) the combined company's plans,
objectives, expectations and intentions with respect to future
operations, products and services; (iv) the competitive position
and opportunities for the combined company; (v) the impact on the
merger on the market for the combined company's products; (vi) the
non-GAAP operating income and integration costs of the combined
company; and (vii) other statements identified by words such as
"potential," "expected," "plan," "estimate," "intend,"
"will," "should", "believe", "target", or words of similar
meaning. Such forward-looking statements are based upon the current
beliefs and expectations of Oclaro's and Opnext's management and
are inherently subject to significant business, economic and
competitive uncertainties and contingencies, many of which are
difficult to predict and generally beyond the control of Oclaro and
Opnext. Actual results may differ materially from the results
anticipated in these forward-looking statements. Factors that could
cause or contribute to such differences include, but are not
limited to: (i) the failure of the merger to close for any reason;
(ii) the competitive position and opportunities for the combined
company; (iii)general business and economic conditions; (iv) the
performance of financial markets; (v) risks relating to the
consummation of the contemplated merger, including the risk that
required stockholder approval and regulatory agencies might not be
obtained in a timely manner or at all or that other closing
conditions are not satisfied; (vi) the impact on the merger on the
markets for the combined companies optical, industrial and consumer
products; (vii) the failure of the combined company to realize
synergies and cost-savings from the transaction or delay in
realization thereof; (viii) the businesses or employees of Oclaro
and Opnext not being combined and integrated successfully, or such
combination taking longer or being more difficult, time-consuming
or costly to accomplish than expected; (ix) operating costs and
business disruption following the merger, including adverse effects
on employee retention and on our business relationships with third
parties; (x) the future performance of the combined company
following the closing of the merger; (xi) the combined company's
ability to maintain gross margins; (xii) effects of fluctuating
product mix on results; (xiii) the combined company's ability to
timely develop and commercialize new products; (xiv) the combined
company's ability to respond to evolving technologies and customer
requirements; (xv) the combined company's dependence on a limited
number of customers for a significant percentage of its projected
revenues; (xvi) the combined company's ability to effectively
compete with companies that have greater name recognition, broader
customer relationships and substantially greater financial,
technical and marketing resources; (xvii) increased costs related
to downsizing and compliance with regulatory requirements in
connection with such downsizing, competition and pricing pressure;
(xviii) the combined company's potential lack of availability of
credit or opportunity for equity based financing; (xix) the
combined company's risks associated with international operations;
(xx) the combined company's outcome of tax audits or similar
proceedings; and (xxi) the outcome of pending litigation against
Oclaro or Opnext. Additional factors that can cause the results to
materially differ than those described in the forward-looking
statements can be found in the most recent Form 10-Q, most recent
Form 10-K and other periodic reports filed by Oclaro and Opnext,
with the Securities and Exchange Commission. They each anticipate
subsequent events and developments may cause their views and
expectations to change. Neither Oclaro nor Opnext assumes any
obligation, and they specifically disclaim any intention or
obligation, to update any forward-looking statements, whether as a
result of new information, future events or otherwise.
Additional Information and Where to Find It
This communication is being made in respect of the proposed
business combination involving Oclaro and Opnext. In connection
with the proposed transaction, Oclaro and Opnext plan to file
documents with the SEC, including the filing by Oclaro of a
Registration Statement on Form S-4 containing a Joint Proxy
Statement/Prospectus and each of Oclaro and Opnext plan to file
with the SEC other documents regarding the proposed transaction.
Investors and security holders of Oclaro and Opnext are urged to
carefully read the Joint Proxy Statement/Prospectus (when
available) and other documents filed with the SEC by Oclaro and
Opnext because they will contain important information about the
proposed transaction. Investors and security holders may obtain
free copies of the documents filed with the SEC on Oclaro's website
at www.oclaro.com or Opnext's website at www.opnext.com or the
SEC's website at www.sec.gov. Oclaro, Opnext and their respective
directors and executive officers may be deemed participants in the
solicitation of proxies with respect to the proposed transaction.
Information regarding the interests of these directors and
executive officers in the proposed transaction will be included in
the Joint Proxy Statement/Prospectus described above. Additional
information regarding the directors and executive officers of
Oclaro is also included in Oclaro's proxy statement for its 2011
Annual Meeting of Stockholders, which was filed with the SEC on
September 9, 2011, and additional information regarding the
directors and executive officers of Opnext is also included in
Opnext's proxy statement for its 2012 Annual Meeting of
Stockholders, which was filed with the SEC on January 26, 2012, respectively.
Participants in the Solicitation
Foros acted as financial advisor to Oclaro and Blackstone
Advisory Partners L.P served as financial advisor to Opnext.
Contact Information:
Investors
Oclaro:
|
Investors
Opnext:
|
Press Oclaro and
Opnext:
|
Jim
Fanucchi
|
Steve
Pavlovich
|
Judy
Radlinsky
|
Summit IR Group
Inc.
|
Opnext,
Inc.
|
Tanis
Communications
|
+1
408-404-5400
|
+1
510-743-6833
|
+1 408-295-4309
X119
|
ir@oclaro.com
|
spavlovich@opnext.com
|
judy.radlinsky@taniscomm.com
|
Copyright 2012. All rights reserved. Oclaro, the Oclaro logo,
and certain other Oclaro trademarks and logos are trademarks and/or
registered trademarks of Oclaro, Inc. or its subsidiaries in the US
and other countries. All other trademarks are the property of their
respective owners. Information in this release is subject to change
without notice.
1,2 *Source: Ovum OC Forecast, Sep.
2011 and LightCounting Dec.
2011 Forecast. 40G/100G segments derived from 3rd-party
reports.
SOURCE Oclaro, Inc.