Madge Networks NV yesterday announced that its Madge.connect unit has bought the token ring business of financially troubled Olicom AS, of Denmark, for $US15 million in cash and additional payments over the next three years.
The sum of the future cash payments will depend on the performance of Madge's token ring business, the Netherlands-based networking vendor said yesterday. As part of the agreement, Madge said that it also will purchase parts of Olicom's inventory of token ring products over the next few quarters.
Madge expects the acquisition to strengthen the company's market position and speed up the development of next-generation token ring products, the company said. Also included in the deal are certain Olicom staff members as well as the company's token ring customer base.
In related news, Olicom yesterday announced the resignation of Niels Jorgensen, the company's executive vice president and chief technology officer. The vendor also said that the Copenhagen Stock Exchange has approved its requested postponement to the end of September for Olicom's second-quarter and half-year financial results.
Niels Christian Furu, Olicom's chief executive officer, will assume Jorgensen's responsibilities until further notice, although Jorgensen will be available in connection with the implementation of the company's ongoing restructuring efforts, Olicom said.