Cabletron Systems Inc. on Tuesday announced that Aug. 6 will be the day the company rides into the sunset by completing the final spin-offs of its subsidiary companies.
In a conference call, Cabletron Chief Executive Officer (CEO) Piyush Patel said Cabletron subsidiary Enterasys Networks Inc. will become its own publicly traded company on Aug. 6, listed on the New York Stock Exchange as ENT. For each Cabletron share held, shareholders will receive two Enterasys shares. Also on Aug. 6, Cabletron stockholders will receive 1.02 shares of Riverstone stock for each Cabletron share they hold.
Network management software maker Aprisma will become a wholly owned subsidiary of Enterasys until Aprisma is also spun off. Cabletron officials said they anticipate that will happen by Dec. 31, either by initial public offering or, more likely, by direct spin-off to Cabletron shareholders. Until then, Aprisma will operate as it did under Cabletron, reporting separate financials and lead independently by its present CEO, Michael Skubisz.
After this spin-off of Cabletron stock to shareholders, Cabletron will cease to exist and will stop trading publicly, as its shares will be distributed to Riverstone and Enterasys stockholders. Patel said he will continue to work with the independent companies as an advisor, but did not say what his official title would be.
Riverstone was the first Cabletron company to go public. Since its IPO (initial public offering) in February, the company's stock has risen almost 32%.
While under Cabletron's wing, Enterasys also fared well. Since Cabletron created the company in February 2000, Enterasys has established itself as a player in the enterprise market. Last year, the firm was second only to Cisco in Layer 3 Ethernet and Gigabit Ethernet switch port shipments, according to IDC. As a public company, says CEO Henry Fiallo, Enterasys will have more autonomy to operate and make acquisitions.