IPG Photonics buys Menara Networks, reaches further into data centers and metro communications
IPG Photonics will acquire Menara Networks, a maker of optical transmission modules and systems for 100G/400G markets.
IPG Photonics (NASDAQ:IPGP; Oxford, MA) will acquire Menara Networks (Anaheim, CA), a maker of optical transmission modules and systems for 100G/400G markets. The acquisition provides IPG entry into the growing optical pluggable systems market and leverages IPG's market access outside North America. IPG says the acquistion provides it with its own mixed signal ASIC proprietary designs that Menara has been vertically into 100G/400G software-defined, flexible, and configurable coherent DWDM transceiver modules.
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Menara had revenues of approximately $21 million in 2015 and is profitable. Projected to close in the second quarter of 2016, the cash purchase price is $46.8 million, subject to closing adjustments. The Menara management team, including co-founders Siraj Nour El-Ahmadi and Salam Elahmadi, and other employees are planning to remain with the combined company.
Major customers of Menara include a leading multiple service operator (MSO), a large US data center operator, and optical network system integrators, augmenting IPG's current list of communications network operators and service providers.
"The acquisition of Menara Networks is in line with our strategy to make bolt-on acquisitions that provide us with the talent, technology, and products to enter large complementary markets," said Valentin Gapontsev, IPG Photonics' Chairman and CEO. "Since IPG was founded in the 1990s, telecom products have been a staple offering for IPG, part of our DNA. This acquisition broadens and complements our telecommunications offerings and provides significant sales synergies. Together, we can offer our customers an expanded telecom technology platform with more integrated products with superior performance and economics. The acquisition also affords IPG a better position to capitalize on the robust growth of optical networking driven by video and broadband access."
"The on-going shift to cloud based services and infrastructure has placed unprecedented strain on data centers and telecom/cable operators' optical networks and presents a significant opportunity for Menara's differentiated products," comments Siraj Nour El-Ahmadi, Menara CEO, Chairman and Co-Founder. "We view the combination with IPG as a force multiplier to not only expand our market share vertically and geographically but just as importantly to bring about innovative and differentiated turn-key solutions that will effectively address the large and growing global DWDM market."
IPG Photonics and Menara Networks had recently announced a partnership to provide an integrated solution for simplified repeater-less 100G DWDM transmission for metro and data center interconnection. Menara's cost and foot-print-saving product suite of 10G and 100G WDM modules eliminate the need for high-priced transponder systems.