SAN FRANCISCO (07/10/2000) - In what is believed to be the largest technology merger ever, fiber-optics manufacturer JDS Uniphase Corp. (JDSU) has agreed to buy competitor SDL Inc. (SDLI) for about $41 billion in stock.
JDS will give each SDL shareholder 3.8 shares of its stock, a premium of nearly 50 percent over SDL's Friday closing price. The companies, both based in San Jose, Calif., said they expect the merger to accelerate product delivery.
"This combination brings together world-class technical and manufacturing teams that promise to deliver best-in-class products at increased volumes for today's systems while developing solutions for tomorrow," said Don Scifres, chairman, president and CEO of SDL in a statement.
The deal is the latest in a string of fiber-optic mergers, as the growth of the Internet has boosted demand for bandwidth and a larger, more flexible telecommunications network. The merger, announced Monday, is expected to face scrutiny from antitrust regulators.
It comes on the heels of JDS's $15 billion purchase of E-Tek Dynamics (ETEK) , which became complete June 30. To win antitrust clearance on that merger, JDS and E-Tek agreed to several conditions set by the Department of Justice in a consent decree.
SDL also has been on a buying spree. Since January, it has acquired three companies at a total cost of about $3 billion.
SDL, which has a staff of 1,700 and reported $72 million in first-quarter sales for the period ended March 31, will become a wholly owned subsidiary of JDS.
JDS has more than 17,000 employees; it reported $395 million in sales for its third quarter, which ended March 31.
JDS stock fell 12 percent to 102 1/4 in morning trading today. SDL's stock rose 10.6 percent to 326 1/2.