Lucent Eyes High-Speed Chip Market

Taking another step in an attempt to keep up with fast-moving Cisco Systems Inc., Lucent Technologies Thursday made a buy that will add high-speed chips for packet-based networks to its product line.

Lucent (LU) is buying Agere, a maker of programmable network processors, for about $415 million in stock. Lucent will exchange about 8 million of its shares for all outstanding Agere equity.

Lucent will take an unspecified one-time charge in conjunction with the purchase, which is expected to close by June 30.

Lucent said Agere’s chip line will enable network equipment makers to include new features to switches and routers without raising manufacturing costs. Agere also has technology that allows communications providers to add features to existing equipment on the fly, reducing development and deployment costs.

Ed Roberts, vice president and general manager of Lucent Microelectronics’ network and communications unit, said the buy will give network equipment makers additional speed, flexibility and cost efficiency.

“We expect Lucent and Agere’s combined expertise in network processors will enable us to deliver next-generation capabilities this year,” he said.

Agere’s staff will become employees of Lucent’s network and communications unit but will remain based in Agere’s Austin, Texas, headquarters.

News Around the Web