The troubled telecoms equipment provider Marconi yesterday sold its optical components business to Bookham Technology, an optical components maker, in an all-share deal worth £19.7m.
Marconi, which is selling off assets to pay down debt, will end up with 12.89 million shares in Bookham, equating to a 10 per cent stake, which it cannot sell for six months. In addition, Marconi has agreed to buy a minimum of £30m of components from Bookham over the coming 18 months.
Shares in Bookham closed up 8 per cent at 165p after investors believed it had got the better end of the deal. Shares in Marconi finished down 6 per cent at 39.90p .
Defending the deal, Mike Parton, Marconi's chief executive, said: "Marconi sees very real value in holding a substantial shareholding in a business that will become a leading provider of integrated photonic solutions worldwide, whilst eliminating Marconi's ongoing investment requirements."
Marconi's optical components business, which is based in Caswell, Northamptonshire, employs some 500 people. It makes such products as transmitters, receivers and lasers. In the year to 31 March, it recorded a loss before tax of £18.7m on sales of £11.1m.
The deal is subject to approval by Bookham's shareholders.Reuse content