Corvis to acquire Dorsal Networks

In a move that nearly doubles its undersea market opportunities, Corvis announced yesterday that it will acquire Dorsal Networks in a stock transaction valued at about $90 million.

Corvis is acquiring the transoceanic and regional undersea optical network solutions provider for about 40 million shares of Corvis stock. All outstanding Dorsal shares and options held by its employees will be exchanged for shares and options in Corvis. The deal excludes the 3 percent stake Corvis already acquired through a previous agreement.

For nearly 10 percent of the company, Corvis will almost double its market opportunities, said David Huber, chairman and CEO of Corvis, during a Webcast yesterday. “This acquisition significantly expands our market opportunity to include transoceanic and regional undersea systems,” he said. “It positions Corvis as one of the few end-to-end vendors of next-generation terrestrial and networking solutions.”

It also positions the company to meet carriers’ needs for a single open platform for global networks, added Terry Unter, chief operating officer for Corvis. “We will deliver optical backbone solutions that maximize network efficiencies, regardless of where continents and oceans begin and end,” he said.

Corvis expects to complete the acquisition by second quarter 2002. A committee comprising the Board of Directors of both Corvis and Dorsal approved terms of the agreement. Huber was not on the committee but agreed to vote his shares in favor of the transaction.