News Article
NeoPhotonics gains a hefty $39.8 million from Rusnano
The PIC provider is obtaining gross proceeds at $8.00 per share for expansion in Russia to accelerate adoption of high-speed, agile and coherent indium phosphide PIC technologies. A portion of the cash from the sale of the shares will be used for corporate purposes and establish design and production capabilities in Russia for the benefit of the global organisation
NeoPhotonics has received an investment from Rusnano, a $10 billion sovereign investment corporation based in Moscow, Russia.
Rusnano acquired 4.97 million newly-issued common shares of NeoPhotonics Corporation in a private placement transaction at a price of $8.00 per share for gross proceeds of $39.8 million. The company’s per share closing trading price on April 27, 2012, was $4.49.
The shares are restricted from resale pursuant to a lockup agreement for up to two years, at the end of which the Company is obligated to register the shares for potential resale. In connection with the investment, the Company appointed Sergey Polikarpov, Rusnano Managing Director, to the board of directors.
“We are pleased to receive this strategic investment from Rusnano,” says Tim Jenks, Chairman, President and CEO of NeoPhotonics. “We welcomed this investment as it aligns with our strategy to accelerate growth globally, with particular emphasis on fast growing and emerging markets, including in Russia and the CIS countries.”
“Not only are these markets deploying high speed, agile and fibre-to-the-home networks but we are also seeing more of our customers target service providers and invest locally in Russia and more broadly in Eastern Europe,” continues Jenks.
“We started to see and investigate this growth opportunity several years ago, and we added sales capability in the region and have since been engaged with and supplying several customers in Russia. With the planned support from RUSNANO, we believe that NeoPhotonics is well-positioned to capitalise on new and greater opportunities in the region.”
“One of the unique advantages of NeoPhotonics is its vertically-integrated design and manufacturing processes for photonic integrated circuit-based products,” comments Polikarpov. “The Company’s planned research and production facilities in Russia are intended to be able to perform a wide range of steps from PIC development to processing and fabrication. We believe that with our support in Russia, we can further enhance the Company’s development cycles and shorten the time for broader adoption for NeoPhotonics products in Russia and the global market.”
NeoPhotonics intends to use a portion of the net proceeds from the sale of the shares of common stock for general corporate purposes as well as to establish design and production capabilities in Russia for the benefit of the global organisation.
The expansion in Russia is targeted for completion by July 31, 2014, and is not expected to have a material impact on the Company’s results of operations in 2012.
