Another Australian IT startup success has been snapped up by a multi-national in what one of the founders called "the logical next step for us."
Sydney-based optical components company, Photonic Technologies, has been wholly bought by Nortel Networks, exactly two years after Nortel acquired a one third stake in the company.
The cash deal, worth over AU$60 million, is said to have resulted from the success of this collaboration, according to Reg Bird, president of Service Provider Solutions for Nortel Networks in Australia and South Asia.
Photonic's 70 employees and state-of-the-art manufacturing facility in Sydney will become part of Nortel's recently-formed High Performance Optical Component Solutions unit.
"Nortel has great faith in the optical electronic business in Australia," Bird said. Nortel has invested US$600 million globally on equipment and components in the optics market. The move "demonstrates our commitment by increasing our infrastructure here."
Analysts predict the growth rate of the optical Internet market is 37 percent per year, it is "the only technology that can manage the growth of the Internet," Bird said. Even though he believes the market is greatly underestimated.
Photonic designs and manufactures optical components such as filters and circulators for telecommunication applications, "critical components that extend the speed and reach of high capacity optical networks," said Ralph Betts, managing director of Photonic Technologies.
Photonic, with a turnover of AU$4.3 million last year, was founded in 1993 by Betts and Steven Frisken. Both left Telstra to form the new company. They now develop technology for system manufacturers who supply telecommunication providers such as their previous employer.
Despite Australia being a leader in the research and development of the technology, 95 percent of the company's revenue comes from export, Betts said.
