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Juniper to buy Pacific Broadband for $200 m

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CIOL Bureau
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SUNNYVALE: Juniper Networks Inc., which makes Internet communications

equipment, said on Monday it would buy privately held Pacific Broadband

Communications for about $200 million in stock in order to connect its

high-speed optical equipment with home and office cable systems.

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The acquisition would allow Juniper to enter the market for providing the

equipment needed to drive advanced Internet-based services, including

pay-per-view video and high-speed modem access, to cable television subscribers.

Pacific Broadband, in which Juniper already holds a two to three per cent

stake, is currently testing a system that would allow cable operators to deliver

advanced Internet-based services over existing copper lines, the company said.

Sunnyvale, California-based Juniper projects that market will grow from $500

million this year to $1.3 billion by 2005 and said the acquisition would allow

it to move beyond the market for Internet communications equipment in the

long-haul, carrier-based portion of the network where it competes with Cisco

Systems Inc.

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"The strategy here is to reach out from our core, backbone

presence," Juniper Chairman Scott Kriens told Reuters.

Closer to the edge



Kriens said the Pacific Broadband technology would figure prominently in
delivering broadband services over cable lines, including both business or

homes.

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"At the point of concentration for all this high bandwidth demand, there

have to be systems built that are reliable and scalable and intelligent in order

to separate each of the users and identify each of them relative to their

priority within the network," Kriens said.

San Jose-based Pacific Broadband was launched in November 1999 and had raised

a total of about $51 million to date, company president and chief executive Alok

Sharma said.

The acquisition by Juniper, expected to close in the fourth quarter, would be

the company's fourth in its five-year history and was expected to add to

earnings in 2003, Kriens said. "We see this as a very strategic

footprint," Kriens said. "It's certainly a new functional

footprint."

The planned acquisition comes as Juniper shares have rebounded sharply in

recent weeks. Juniper shares, which have rallied with those of other network

equipment maker stocks, closed on Monday at $23.99, up 55 cents or 2.4 per cent

and 170 per cent from their year-low of $8.90 on Sept. 27.

(C) Reuters Limited.

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