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(CIEN) - Get Ciena Corporation Report

announced Tuesday that it purchased privately held

Cyras Systems

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for 27 million shares of its stock, a deal worth $2.6 billion.

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Cyras, based in Fremont, Calif., develops optical switching systems for metropolitan, and therefore high-traffic, areas. This move helps expand Linthicum, Md.-based Ciena's reach further into the optical networking business. Cyras will become a new multi-service access and switching division within Ciena.

The deal, unanimously approved by both companies' boards of directors, will dilute 2001 earnings by 19 cents to 21 cents a share and will add to earnings by the second half of fiscal 2002, the company said. The deal will close in the first quarter of 2001.