MRV Communications (Nasdaq:MRVC) and Luminent, Inc. (Nasdaq: LMNE) jointly announced today that MRV intends to carry out a short-form merger with Luminent, its 92.3% owned subsidiary.
The terms of the deal will be determined and announced later.
MRV also announced that Shay Gonen has been appointed as interim chief financial officer, replacing Edmund Glazer, MRV's CFO who perished Tuesday on American Airlines flight 11 that crashed into the New York World Trade Center. Shay Gonen is currently CFO, and President North American Operations at Optical Access, an MRV subsidiary.
As for the merger, under Delaware law, Luminent shareholders not wishing to accept the consideration offered in the merger will be entitled to appraisal rights and to receive payment of the fair value for their shares following the effectiveness of the merger.
The merger will be subject to usual terms and conditions including regulatory approvals. In conjunction with the filing, MRV intends to seek outside professional advice and consider other strategic alternatives for Luminent.
"Due to the current slowdown in the telecommunications sectors, the market for optical components is currently suffering from weak demand. Although this could change in the future, the business of Luminent will be better served when integrated into MRV," commented Noam Lotan, president and CEO of MRV.
"By applying MRV's system level know-how, we achieve a higher level of integration of optical components and optical subsystems. This is expected to enhance Luminent's optical transmission platforms, thereby better supporting existing customers, while creating new market opportunities.
"Unifying Luminent with MRV is expected to enhance our competitive position and generate substantial savings in the consolidated results, by removing inefficiencies and duplications. Our action will allow Luminent to invest and improve its technology and its bottom line," Lotan said.
Effective today, Dr. William R. Spivey, has stepped down and resigned his position as Luminent's President, CEO and Director. Noam Lotan, who is currently Chairman of Luminent, will assume the position of interim CEO.
As a result of the anticipated merger, Richard Hill and Amos Wilnai resigned from Luminent's board and have been replaced by Dr. Yigal Shidlovsky and Arie Zimmerman. Dr. Shidlovsky serves as Director of MRV Communications. Zimmerman was the founder of several companies including Phasecom Corporation, which was subsequently sold and became public under Vyyo, MDS Systems and Satellite Common Carrier.