Nortel Networks has completed the acquisition of Sonoma Systems, which delivers high-speed integrated video, data and voice communications simultaneously over a single connection.
The acquisition will position Nortel Networks to tie the bandwidth and power of the high-performance optical Internet to the access solutions of the local Internet. The Yankee Group estimates that the market for delivering carrier-managed services will reach more than $18 billion globally by 2002, up from $10 billion this year.
“Nortel is leading the charge in delivering the high-performance Internet,” said Gregory Koss, CEO of Sonoma. “We are now focused on delivering integrated access devices to extend new services as part of the local Internet portfolio.”
The acquisition was effected by the merger of a Nortel subsidiary with and into Sonoma. Approximately 4.8 million Nortel shares were issued in exchange for all of the issued and outstanding shares of Sonoma stock, and approximately 1.3 million additional Nortel Networks common shares were reserved for issuance upon the exercise of outstanding Sonoma options and warrants that have been assumed by Nortel. In addition, a maximum of $72 million in Nortel shares may be issued to former Sonoma shareholders and option holders upon Sonoma achieving certain business objectives.
Sonoma is headquartered in Marina del Rey, California, with a technology center located in Marlborough, Massachussets, and sales and support offices throughout North America and in the UK.
Nortel Networks is today creating a high-performance Internet that is more reliable and faster than ever before. It is redefining the economics and quality of networking and the Internet, promising a new era of collaboration, communications and commerce.