Target major operator core networks to triple optical transport business within 5 years
OTN technology is used to switch data traffic over optical fibers, significantly optimizing network bandwidth utilization. The OTN technology will allow EKINOPS to meet growing market demand for this type of technology. It is estimated that over 40% of the optical network market uses OTN solutions.
This strategic acquisition will enable the Group to become a leader in this field and deliver additional revenue from new OTN products starting in 2020. By offering a global OTN/DWDM solution for optical networks product line, EKINOPS will be able to target the major operator core networks market segment with the objective to triple its optical transport product sales within 5 years.
Main transaction terms
EKINOPS has acquired the advanced OTN technology and an R&D team comprising 25 engineers based in Campinas, near Sao Paulo (Brazil) for €10 million in cash. Brazilian operations are overseen by Jean-Luc Pamart, co-founder of EKINOPS and VP of R&D for optical transport.
The acquisition is financed by the Group’s cash resources (€14.2 million net cash[1] at December 31, 2018) and debt. The Group raised €6.5 million of bank loans in Q2 2019.
[1] Cash and cash equivalents minus borrowings (excluding bank debt relating to CIR research tax credit pre-financing)