DASAN Networks bought Zhone Technology, which is a company from the U.S. that is listed on NASDAQ. Starting from this year, DASAN is working to become a top 5 global company in network field.
DASAN Networks made a public announcement on the 12th that its affiliate from the U.S. called DASAN Network Solutions has agreed to merge with DA Corporation. DA Corporation is a company that was established by Zhone Technology for the purpose of merge. DASAN acquired 58% of Zhone Technology’s shares and established it as DASAN’s major subsidiary company.
Zhone Technology is a provider of telecommunication networking equipment from California and recorded 8th place last year globally in FTTH (Fiber to the home) field. In July when M&A procedures are finished, its name will change to DASAN Zhone Solutions. Starting with this merge with Zhone Technology, DASAN set up a plan to become a top 5 global company in network field. It will also increase percentage of foreign sales from 40% to 50% by end of this year.
It is rare to see a company listed on KOSDAQ buying a company listed on NASDAQ. “Fact that we established a business roadmap by focusing on foreign business had an effect.” said DASAN. “It is a result of focusing on diversifying markets by not only focusing on South Korean network equipment markets, but also increasing percentage of global sales.”
When M&A is finished, DASAN will become a top 7th company in broadband access field followed by global businesses such as Alcatel-Lucent, Huawei and others and become a top 5th company in GPON (Giga-bit Passive Optical Network) equipment field.
If products from these two companies combine, DASAN will get to have a comprehensive network portfolio. It will be able to have variety of product lines by adding next-generation MSAP (Multi-Service Access Platform) and tera-level optical-telecommunication equipment from Zhone Technology to its own products.
Zhone Technology has customers from North America, Middle East, and Europe. On the other hand, DASAN has strong connection of customers from Asian such as South Korea and Southeast Asia. As a result, DASAN predicts that it will be able to increase its shares in global markets as soon as possible.
DASAN is also having its influence in North America. By using Zhone Technology’s awareness and production bases in North America, it is now able to compete with American businesses at an equal level. It can also respond to demands for technical support in the U.S. by utilizing Zhone Technology’s 3 support centers.
“By utilizing NASDAQ-listed company from the U.S., we were able to prepare an important turning point that can shift main markets from South Korea to North America.” said Chairman Nam Min-woo of DASAN Group. “By combining and focusing strengths and capabilities from two companies, we are going to grow as a top 5 global telecommunication equipment provider.
“We are going to quickly increase our shares in global markets by focusing capabilities on broadband access, mobile backhole72 and enterprise markets.” said CEO Jim Norrod of Zhone Technology. “We will also be able to greatly increase efficiency in management, R&D, production, distribution and others.”
Staff Reporter Kwon, Dongjoon | djkwon@etnews.com