Mellanox buys US co Kotura; share price up strongly

Mellanox expects the $82 million acquisition to add $0.01-0.03 to its non-GAAP EPS in 2014.

Yesterday, Mellanox Technologies Ltd. (Nasdaq:MLNX; TASE:MLNX) announced that it was acquiring US company Kotura Inc. for $82 million cash.

On the Tel Aviv Stock Exchange, Mellanox's share price is currently up 5.91%, at NIS 200.60.

Mellanox develops end-to-end interconnect solutions for servers and storage systems, while Kotura develops advanced silicon photonics optical interconnect technology for high-speed networking applications. The boards of directors of both companies have unanimously approved the acquisition.

Mellanox expects the acquisition to add $0.01-0.03 to its non-GAAP earnings per share in 2014.

"The acquisition is expected to expand Mellanoxs ability to deliver cost-effective, high-speed networks with next generation optical connectivity, allowing data center customers to meet the growing demands of high-performance, Web 2.0, cloud, data center, database, financial services and storage applications. Mellanox believes that the Kotura acquisition will enhance its ability to provide leading technologies for high speed, scalable and efficient end-to-end interconnect solutions," said Mellanox.

"Silicon photonics is expected to play a significant role in the enablement of high-speed networks. With world class expertise and over 120 granted or pending patents in CMOS photonics and packaging design, Kotura has made a number of ground breaking innovations in optical interconnects by integrating multiple high speed active and passive optical functions onto a silicon chip. Koturas technology will enable Mellanoxs interconnect products to reach 100 Gigabit per second and beyond bandwidth, and have longer reach optical connectivity at a lower cost, allowing users to further reduce their capital and operating expenses and offer new revenue-generating services.

"Mellanox expects the proposed acquisition of Kotura to enhance its competitiveness and its position as a leading provider of high-performance, end-to-end interconnect solutions for servers and storage systems," it added.

Kotura will become Mellanox's first US R&D center, and Mellanox intends to retain Koturas existing product lines to ensure continuity for customers and partners.

Operating networks at 100 Gigabit per second rates and higher requires careful integration between all parts of the network. We believe that silicon photonics is an important component in the development of 100 Gigabit InfiniBand and Ethernet solutions, and that owning and controlling the technology will allow us to develop the best, most reliable solution for our customers, said Mellanox chairman, president and CEO Eyal Waldman. We expect that the proposed acquisition of Koturas technology and the additional development team will better position us to produce 100Gb/s and faster interconnect solutions with higher-density optical connectivity at a lower cost. We welcome the great talent from Kotura and look forward to their contribution to Mellanoxs continued growth."

Published by Globes [online], Israel business news - - on May 16, 2013

Copyright of Globes Publisher Itonut (1983) Ltd. 2013

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