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Zhone Technologies Acquires NEC Subsidiary

On the heels of seven other acquisitions over the past three years which included Vpacket Communications and a division of Nortel Networks, Oakland, Calif.-based Zhone Technologies, Inc. announced plans Tuesday to acquire NEC Eluminant Technologies, Inc., also known as eLUMINANT.

eLUMINANT is a subsidiary of NEC USA, which is a subsidiary of NEC Corp. , a worldwide provider of broadband and wireless networks and IT products and services.

The deal with eLUMINANT marks Zhone's eighth acquisition and is expected to greatly enhance the company's portfolio of 'Last-Mile' access equipment solutions for voice, data, video, and content service providers connecting to local telephone networks.

The acquisition could also tip the scales in terms of placing Zhone at the lead of a competing marketplace as the holder of one of the broadest offerings of telecommunications infrastructure products.

According to company representatives, Zhone will maintain eLUMINANT's primary offices in Oregon, but the company has not yet determined what it will do with eLUMINANT's Virginia-based facilities.

Zhone will carry over eLUMINANT's engineering, services, and sales staff, but some positions on the administration side of the company might be eliminated, said David Markowitz, vice president of marketing for Zhone.

"Each time we pick up a product or service, we maintain a commitment to maintaining those products," said Markowitz. "We're pretty comfortable with the process."

Under terms of the agreement, which was brokered by Takenaka & Company LLC, Zhone will acquire eLUMINANT's Multiplexers, Digital Loop Carriers, SONET and broadband access products, which remove broadband bottlenecks and provide a bridge between existing copper-based loops and fiber optics.

The addition of eLUMINANT's product portfolio will enable Zhone to provide customers with voice and data services, broadband access, and transport protocols over existing MDU, DLC, or CO-based infrastructure, the company said.

Zhone will also expand its carrier customer base through the acquisition.

The same CEO and CTO that founded Ascend Communications founded Zhone. Ascend was acquired by Lucent Technologies in September 1999.