Shares of fiber optics vendor Opnext (OPXT) were halted this afternoon just before the company said it and competitor Oclaro (OCLR) will merge in a stock swap valued at 0.42 shares of Oclaro for each Opnext share of stock.
That would add up to roughly $1.90 per Opnext share, which would be a roughly 70% premium to today’s close of $1.13, based on Oclaro’s close of $4.66.
There is an extensive PDF presentation posted on Oclaro’s Web site outlining how the companies view their products and markets and relative strengths. There is also a Q&A document.
Alain Coulder, Oclaro’s chairman and CEO, will become chairman and CEO of the combined company, while Opnext’s chairman and CEO, Harry Bosco, will join the board of directors of the new company.
The combined company should have annual cost savings of $35 million to $45 million after the first 18 months from the close of the deal.
The two companies characterized the deal as a “major transformation in the optical industry, bringing together over 30 years of combined telecom and data com optical technology innovation.”
Both companies said the rise of Internet-based video and of “cloud computing” are pushing demands for performance in fiber optic networking components. Together, the two will increase their sales of 40-gigabit-per-second and 100-gigabit-per-second networking components, they said, a market segment they expect to increase 42% per annum, compounded, through 2015.
Management will host a conference call to discuss the deal at 5 pm, Eastern, this evening, and you can catch the webcast here.
In late trading, Oclaro stock was up 10 cents, or 2%, at $4.76.
Opnext shares are to resume trading at 4:55 pm.
Update: Shares of Opnext have resumed trading and are up 64 cents, or almost 60%, at $1.77.
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