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Leading ODM/JDM/EMS supplier for ICT industry, Cambridge Industries Group (CIG) is set to acquire certain optical transceiver product lines from Lumentum Holdings. CIG has also entered into a long-term strategic supply agreement for Lumentum's photonic chips. The transceiver product lines to be acquired by CIG are developed and manufactured by Lumentum's subsidiary Oclaro Japan Inc.
According to Walter Jankovic, Lumentum's Senior Vice President and General Manager, Datacom, the partnership will leverage their respective strengths to better address the market opportunity created by the highly anticipated growth in high-speed datacom and telecom client-side transceiver volumes driven by datacenter expansion and 5G wireless over the coming years. This transaction enables Lumentum to become more commercially focused on its differentiated Indium Phosphide photonic chip capabilities and brings a new customer that is well positioned to compete in the datacom transceiver market.
According to Gerald Wong, CIG's President and CEO, with this acquisition and on-going partnership with Lumentum for supply of their industry leading photonic chips, together with CIG's proven quality and volume JDM and ODM capabilities, CIG expands its capabilities with industry leading optical transceiver products and technology spanning the range of 10G, 25G to 400G serving many long-standing Tier 1 customers. The company believes that with the combination of its strengths in cost effective high-volume manufacturing, and Lumentum's optical transceiver team in Japan with their decades of experience in high performance datacom and telecom transmission, they are well positioned to address customer needs in the datacom and telecom client-side transceiver market.
The transaction is expected to close in the second calendar quarter of 2019 and is subject to certain customary closing conditions for a transaction of this type. The sale is not expected to impact the guidance ranges provided on February 5, 2019 for Lumentum's third fiscal quarter, ending March 30, 2019. Revenue attributable to the products to be sold in the proposed transaction is approximately $20 million of the $50 million to $55 million of datacom revenues previously included in Lumentum's guidance for the third fiscal quarter of 2019.
