Corning Incorporated (Corning, NY) has agreed to buy Oak Industries (Waltham, MA) for $1.8 billion in stock. In the deal, unanimously approved by the boards of both companies and expected to close in the first quarter of 2000, Corning will exchange 0.83 shares of Corning common stock for each share of Oak common stock. The transaction will be accounted for as a pooling of interests and will be tax-free to Oak Industries shareholders. Corning expects the transaction to be accretive to its earnings beginning in 2000.
From the perspective of Corning, the crown jewel of its acquisition is the Oak Industries subsidiary Lasertron Inc. (Bedford, MA), a maker of active fiberoptic components such as 980-nm pump lasers for erbium-doped fiber amplifiers (EDFAs). Corning itself is well known for its expertise in passive fiberoptics, including optical fiber and cables, couplers, and wavelength-division-multiplexing components. Corning also produces EDFAs—which are active components--but until now has done so using pump—laser modules from outside sources.
