Lumentum announced plans to sell certain optical transceiver product lines developed and manufactured by its subsidiary Oclaro Japan to Cambridge Industries Group (CIG). The sale is not expected to impact the guidance ranges provided on February 5, 2019 for Lumentum's third fiscal quarter, ending March 30, 2019. Revenue attributable to the products to be sold in the proposed transaction is approximately $20 million of the $50 million to $55 million of datacom revenues previously included in Lumentum's guidance for the third fiscal quarter of 2019.
CIG also entered into a long-term strategic supply agreement for Lumentum's photonic chips.
"I am pleased to partner with CIG and leverage our respective strengths to better address the market opportunity created by the highly anticipated growth in high-speed datacom and telecom client-side transceiver volumes driven by datacenter expansion and 5G wireless over the coming years," said Walter Jankovic, Lumentum's Senior Vice President and General Manager, Datacom. "This transaction enables Lumentum to become more commercially focused on its differentiated Indium Phosphide photonic chip capabilities and brings a new customer that is well positioned to compete in the datacom transceiver market."
"With this acquisition and on-going partnership with Lumentum for supply of their industry leading photonic chips, together with CIG's proven quality and volume JDM and ODM capabilities, CIG expands its capabilities with industry leading optical transceiver products and technology spanning the range of 10G, 25G to 400G serving many long-standing Tier 1 customers," said Gerald Wong, CIG's President and CEO. "We believe with the combination of CIG's strengths in cost effective high-volume manufacturing, and Lumentum's optical transceiver team in Japan with their decades of experience in high performance datacom and telecom transmission, we are well positioned to address customer needs in the datacom and telecom client-side transceiver market."
The transaction is expected to close in the second calendar quarter of 2019 and is subject to certain customary closing conditions for a transaction of this type.
