July 29, 2005 Billerica, MA, and Cambridge, UK -- Optical
switch vendors Continuum Photonics
Inc. and Polatis Ltd. have
agreed to merge under an as-yet undisclosed name. The two firms,
both of which offer products based on piezo-electric beam steering,
will combine additional cash as well as current investors and
product lines on the merger's expected completion date of August 15.
According to Aaron Bent, Continuum's vice president of marketing,
the two companies may have similar base technologies, but they've
done different, albeit complementary things with them. Continuum
Photonics, founded in 1998, has focused on the optical automation
systems market, which entails making test labs more efficient. The
company pairs its switching skills with gain equalization and power
monitoring capabilities under the DirectLight name. Polatis, founded
in 2000, has enjoyed its greatest success in the defense market. Its
Micro-Actuation and Sensing System (MASS) platform creates a very
stable device that can switch dark fiber, Bent says.
The combined companies will offer switching products for the test
and measurement, defense, video, network test and monitoring, and
transport markets. Bent reveals that new products for this last
category should debut this September at ECOC in Glasgow, Scotland.
The products will address network monitoring and wavelength
management, with the latter possibly competing with wavelength
blockers and two-dimensional MEMS devices for a place within
reconfigurable optical add/drop multiplexers (ROADMs).
The two companies will contribute a significant amount of cash to
the new firm, although Bent declined to estimate how much. Continuum
closed a $17.5 million round in April 2004, while Polatis received
$9.4 million in third-round financing last November. The two
companies' existing investors are expected to kick in a few more
dollars as well. Continuum's investors include Flagship Ventures,
Prism Venture Partners, JK&B Capital, Boston Millennia Partners,
Harris and Harris Group, GE Capital, MTDC, Arcadian Venture
Partners, and Gainesborough Investments. Polatis is supported by 3i,
Alta Berkeley, Prelude, and EonTech.
The new company will retain offices and manufacturing facilities
in the United States and the UK. Bent says it is likely products
sold in the North American market will be manufactured in the United
States, with the UK facility servicing European orders. Bent says
that the usual reduction of redundant positions should occur,
particularly at the management level. He declined to speculate who
would occupy the top management spots on August 15.
-- S. Hardy
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