Tellabs Acquires WiChorus to Revolutionize the Mobile Internet
22 Oktober 2009 - 1:00PM
PR Newswire (US)
Extends mobile solution with innovative 3G/4G mobile packet core to
help customers succeed NAPERVILLE, Ill., Oct. 22
/PRNewswire-FirstCall/ -- Users want mobile Internet services
anywhere, anytime. Sales of smartphones are growing more than 30% a
year, and netbooks are taking root. As a result, Tellabs' mobile
customers expect mobile data traffic to grow 30% to 50% a year for
the foreseeable future. Such high growth demands scalable,
next-generation network architectures to deliver 3G and 4G
services. That's why Tellabs, a leader in mobile backhaul networks,
will acquire WiChorus of San Jose, Calif. The combination creates
advanced 3G/4G mobile networks that revolutionize the mobile
Internet, deliver new applications to generate revenue and simplify
networks to achieve significant savings for mobile carriers. "As we
expand logically into an adjacent market with the SmartCore(TM)
platform, Tellabs and WiChorus can help mobile customers succeed by
revolutionizing the mobile Internet," said Robert W. Pullen, chief
executive officer (CEO) and president of Tellabs. "Our customers
are excited about this combination, since they can deliver rich,
distinctive personalized user experiences such as mobile Internet,
video and commerce. This move complements, differentiates and
advances our growth solutions portfolio including Tellabs Mobile,
Optical and Business Solutions." The acquisition adds WiChorus'
breakthrough SmartCore(TM) mobile packet core platform, the only
currently available platform that is purpose-built for 4G, LTE and
WiMax, with support for 3G. The SmartCore(TM) platform addresses
the unique requirements of the mobile Internet as it: -- Includes a
full range of mobile IP products (from low entry price to highly
scalable) for applications including GGSN, LTE and WiMax, plus new
application enablement with superior DPI capability. -- Offers 8
times more throughput, 4 times more simultaneous Internet
connections and active users, compared with competitive platforms
in gateway applications. -- Uniquely combines world-class
application analytics with a mobile core gateway for improved
traffic engineering and network optimization. -- Enables customers
to analyze and monetize more than 400 of the top mobile Internet
applications. -- Makes mobile networks content-aware and
context-aware, with personalized application-awareness. --
Outperforms other platforms in delivering mobile Internet capacity.
For example, competitors' capacity significantly degrades (as much
as 30% to 50%) during deep-packet inspection (DPI). -- Delivers new
and differentiated applications such as Internet offload and
distributed LTE gateway. The SmartCore(TM) platform can offload as
much as 70% of traffic at the network edge, increasing core network
efficiency and improving user experiences. As a result, customers
can save as much as 50% in capital expenses, compared with the
present method of operation. Under the terms of the transaction,
which was approved by both companies' boards of directors, Tellabs
will pay approximately $165 million in net cash for WiChorus. The
transaction is expected to be dilutive to Tellabs' earnings in
2010, then additive to Tellabs' non-GAAP earnings in 2011 and
beyond. Non-GAAP earnings exclude amortization associated with
acquired intangibles and other purchase accounting adjustments.
"WiChorus SmartCore is the leading packet core solution in the
industry, providing the highest performance and built-in
optimization and monetization capabilities," said Rehan Jalil,
president and CEO of WiChorus. "The combination of the world's most
advanced packet core with Tellabs' IP mobile backhaul solution and
intelligent network manager creates a winning combination and a
comprehensive mobile Internet portfolio. The combination will
enable service providers to enhance mobile users' experience,
deliver new revenue-generating applications and achieve savings."
On completion of the transaction, Rehan Jalil will head a newly
formed Tellabs IP and mobile Internet group, as senior vice
president, reporting to Pullen. The transaction is subject to
customary closing conditions and regulatory reviews. It is expected
to close within the next several months. Prior to close, Tellabs
and WiChorus will continue to operate as separate companies. The
combined company will employ about 3,250 people. Simultaneous
Webcast and Teleconference Replay -- Tellabs will host an investor
teleconference at 7:30 a.m. Central Daylight Time today to discuss
the WiChorus acquisition. To access the conference call, dial
866-393-8608 at least 15 minutes prior to call-start time. (Outside
the United States, call 706-679-4976). When prompted, enter the
Tellabs conference ID number: 37493961. Internet users can hear a
simultaneous webcast of the teleconference at
http://www.tellabs.com/; click on the webcast icon. A taped replay
of the call will be available beginning at approximately 10:30 a.m.
Central Daylight Time today, until midnight Central Daylight Time
on Oct. 23, at 800-642-1687. (Outside the United States, call
706-645-9291.) When prompted, enter the Tellabs conference ID
number: 37493961. A podcast of the call will be available at
http://www.tellabs.com/news/feeds/ later today. About Tellabs --
Tellabs helps customers succeed through innovation. That's why 43
of the top 50 global telecom service providers choose our mobile,
optical and business solutions. We help telecom service providers,
independent operating companies, MSO/cable TV companies,
enterprises and government agencies get ahead by adding revenue,
reducing expenses and optimizing networks. With wireless and
wireline networks in more than 90 countries, we enrich people's
lives by innovating the way the world connects(TM). Tellabs
(NASDAQ:TLAB) is part of the NASDAQ Global Select Market, Ocean
Tomo 300(TM) Patent Index, the S&P 500 and several corporate
responsibility indexes including FTSE4Good and eight KLD indexes.
http://www.tellabs.com/ About WiChorus -- WiChorus is an industry
leader in Smart 4G Packet Core infrastructure products. Its
purpose-built SmartCore platform's unmatched performance with
integrated content and network intelligence enables operators to
deploy smart HSPA, LTE and WiMAX Packet Core networks, that
optimize network resources, deliver new revenue generating services
and monetize the Internet. With headquarter offices in San Jose,
California, WiChorus is a private company with financial backing
from Accel Partners, Mayfield Fund, Redpoint Ventures and Pinnacle
Ventures. For more information, please visit
http://www.wichorus.com/. For more information, please visit
http://www.wichorus.com/. Forward-Looking Statements -- Statements
in this press release regarding the proposed Tellabs acquisition of
WiChorus. which are not historical facts, including expectations of
financial results for the combined companies (e.g., projections
regarding revenue, earnings, cash flow and cost savings), are
"forward-looking statements." Forward-looking statements are not
guarantees of future performance and involve risks, uncertainties
and other factors that may cause either company's actual
performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by
those statements. Either company's actual future results could
differ materially from those predicted in such forward-looking
statements. Investors and security holders are cautioned not to
place undue reliance on these forward-looking statement and any
such forward-looking statements are qualified in their entirety by
reference to the following cautionary statements. Important factors
upon which the forward-looking statements presented in this release
are premised include: (a) receipt of regulatory and stockholder
approvals without unexpected delays or conditions; (b) timely
implementations and execution of merger integration plans; (c)
retention of customers and critical employees; (d) economic changes
impacting the communications industry; (e) successfully leveraging
Tellabs/WiChorus comprehensive product offering to the combined
customer base; (f) the financial condition of communications
service providers and equipment vendors, including any impact of
bankruptcies; (g) the impact of customer and vendor consolidation;
(h) successfully introducing new technologies and products ahead of
competitors; (i) successful management of any impact from slowing
economic conditions or customer demand; and (j) protection and
access to intellectual property, patents and technology. In
addition, the ability of Tellabs/WiChorus to achieve the expected
revenues and accretion will be affected by the effects of
competition (in particular the response to the proposed transaction
in the marketplace), the effects of general economic and other
factors beyond the control of Tellabs/WiChorus, and other risks and
uncertainties described from time to time in Tellabs public filings
with the Securities and Exchange Commission. Tellabs disclaims any
intention or obligation to update or revise any forward-looking
statements. Glossary 3G Mobile Networks are wireless networks build
for digital voice and high-speed data, including video. 4G Mobile
Networks are the future generation of wireless networks, designed
to offer broadband speeds and integrate different types of mobile
technology. LTE or Long Term Evolution, which is still being
defined by industry standard bodies, is faster, cheaper and better
than 3G. WiMax provides wireless broadband Internet service in a
coverage area of up to 30 miles in diameter. HSPA or high-speed
packet access is a high-speed, 3G digital packet service based on
GSM (global system for mobile communications) standard. DPI or deep
packet inspection looks into a packet or traffic stream to
determine its impact and make decisions on its significance, so it
can be handled appropriately to improve the user experience. GGSN
or Gateway GPRS Support Node is a component that fits into the
mobile switching center of a wireless network. Tellabs® and Tellabs
logo® are trademarks of Tellabs or its affiliates in the United
States and/or other countries. Any other company or product names
mentioned herein may be trademarks of their respective companies.
DATASOURCE: Tellabs CONTACT: media, George Stenitzer,
+1-630-798-3800, , investors, Tom Scottino, +1-630-798-3602, , both
of Tellabs Web Site: http://www.tellabs.com/
http://www.wichorus.com/
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