Sorrento to buy LuxN

Sorrento Networks, a supplier of metro and regional optical networking systems, last week announced a definitive agreement to acquire optical access equipment maker LuxN.  

Sorrento says the acquisition expands its addressable market by adding optical access products that combine coarse and dense wavelength division multiplexing on the same platform, with in-wavelength management. The merger also broadens Sorrento’s customer base by adding 25 customers, including Time Warner Telecom, Hawaii I-Net, Yipes Enterprise Services, and numerous universities.

Sorrento’s customer base and market focus include communications carriers and service providers in the telecommunications, cable TV and utilities markets.

The purchase price for the transaction will be a combination of stock, warrants, and cash, including some of the $17 million to $18 million in cash currently held by LuxN. Shareholders have the option to exchange their LuxN shares for Sorrento stock.

Up to 1.8 million Sorrento shares could be exchanged for LuxN stock, Sorrento says. Sorrento stock was trading at $2.65 per share on Thursday, June 26.

LuxN’s 150 employees will remain based in Sunnyvale, Calif., for the time being, a Sorrento spokesman says. As the companies are integrated, there may be changes in the organization and where operations are located, he says.

Sorrento is based in San Diego and has 105 employees.

LuxN raised $150 million through venture and corporate funding since its founding in 1998. Sorrento’s fiscal 2003 revenue was about $25 million.