TeraXion completes $15M first round
Within the framework of its strategic development, TeraXion will use the proceeds to further develop key R & D projects and increase its manufacturing capacity to respond to the ever-growing market demand for its products.
TeraXion provides its customers with high-performance components based on Fiber Bragg Grating technology with improved optical specifications. These components act as filters to combine, extract, shape, balance, and stabilize light messages propagating in optical fibers to bring them to destination in a seamless manner.
TeraXion's success can be largely attributed to its unique design standards and customized product specifications allowing flexibility and rapid prototyping required to improve its customers' products and reduce their development time. TeraXion launched its new super athermal 25 GHz WDM filter at the OFC 2001 conference, thereby leading the way to ultra-dense WDM optical systems.
"Customer reactions have been very positive regarding both the optical performance and the execution quality of our components", says Alain Chandonnet, TeraXion President and CEO. "This investment will help us leverage the very important relationships established so far with our customers by providing them with continuous product innovations and the manufacturing capacity they are expecting from TeraXion".
Proceeds from the financing will be used to develop the next generation of optical components required by the ultra-dense WDM optical networks and 40 Gbps transmission systems. TeraXion will also pursue its aggressive growth strategy by substantially increasing the capacity of its world-class manufacturing facility, while maintaining its high standards of quality (Bellcore Telcordia™). This investment will sustain the growth of the company and enable it to capture increasing market share.
"We are delighted to be a part of TeraXion," says Richard J. Renaud, Wynnchurch Capital. "This is a qualified and focused management team that has so far exceeded our expectations. We will continue to work closely with them in the execution of their plan".
This first round of investment includes key strategic investor Sumitomo Corporation Group and other institutional investors, namely Robertson Stephens, Business Development Bank of Canada, Innovatech Quebec and Royal Bank Capital Partners. As well, Wynnchurch Capital, LBG Capital, and a group of "angel" investors added to their existing stakes in this preferred stock financing. RBC Dominion Securities acted as advisor to TeraXion in this transaction.
About TeraXion
TeraXion designs and manufactures innovative optical components for the high-performance optical networks of today and tomorrow. These components act as filters to combine, extract, shape, balance, and stabilize light messages propagating in optical fibers to bring them to destination in a seamless manner.
TeraXion specializes in technologies responding to the most stringent performance requirements of high bandwidth optical networks. By combining technologies such as Fiber Bragg Gratings with its proprietary TerAnneal™ writing and processing procedures, TeraXion's R&D team has developed the ability to provide optical components tailored to the needs of its customers with an unprecedented degree of consistency.
Through continuous innovation and total dedication to reliability and performance, TeraXion seeks to provide the building blocks for tomorrow's all-optical network transmission equipment.
TeraXion is channeling the optical bandwidth™
About Wynnchurch Capital
Wynnchurch Capital is a privately owned investment management firm managing a number of private equity funds with capital under management in excess of $200 million. Wynnchurch specializes in management buyouts, recapitalizations, restructurings, acquisitions and growth capital investments. Wynnchurch's objective is to partner with companies that have outstanding management teams and the potential for substantial growth.
Wynnchurch works in partnership with the senior management of the firms it invests in with the objective of growing shareholder value. Wynnchurch focuses on increasing a company's revenues through enhancing sales and marketing efforts, adding corporate resources, investing in new product initiatives and executing key strategic acquisitions; all while increasing profitability through cost reductions and operational improvements.
The Managing Partners of Wynnchurch Capital have been highly successful in generating investment returns and building sustainable business value. Collectively, they have completed more than 200 investments in middle market companies during their combined 48-year investment history and have investment expertise in the following industries: manufacturing, metals, consumer products, financial services, distribution, telecommunications and later-stage information technology.
The firm is primarily interested in working with companies where Wynnchurch and management can identify substantial opportunities for revenue growth, geographic expansion, strategic acquisitions and operational improvements. Once such opportunities are identified, Wynnchurch makes a commitment of resources and capital positioning the firm as a long-term investor in partnership with company management. For more information contact www.wynnchurch.com.
About Business Development Bank of Canada
The Business Development Bank of Canada (BDC) is a major venture capital investor in Canada. BDC has been involved in venture capital since 1975 and has to date invested in more than 270 different companies. It currently manages over $350 million in venture capital assets. BDC favors companies who are technology-based and which offer high growth potential. For more information contact www.bdc.ca.
About Innovatech Quebec
Innovatech Québec is a Québec government venture capital corporation specializing in pre-startup and startup financial assistance to technology-intensive companies. Innovatech Québec helps finance technological innovations within its territory in the following fields: information technology and telecommunications, optics and photonics, biotechnology and life sciences, and industrial technology For more information, contact www.innovatech-quebec.qc.ca.
About LBG Capital
LBG Capital is a division of National Bank Financial that manages private equity investments for private clients. National Bank Financial is a subsidiary of the National Bank, created by the September 8, 1999, merger of Lévesque Beaubien Geoffrion (and its subsidiary Levesque Securities) and First Marathon Inc. With about 2,700 employees and 86 offices, National Bank Financial is one of the largest investment dealers in Canada. Its pro-forma annual revenues of over $700 million place it among the leaders in the Canadian investment industry. In addition, client assets of approximately $33 billion held for nearly 250,000 individual clients indicate the extensive reach of its operations. With capital of $600 million, National Bank Financial is very strong financially on a stand-alone basis. As well, it draws added strength from being a subsidiary of National Bank with its $3.2 billion in shareholders' equity. For more information, contact www.nbfinancial.com.
About RBC Capital Partners
Royal Bank Capital Partners is the private equity arm of Royal Bank Financial Group. RBCP combines expertise in venture capital, merchant banking and mezzanine financing to offer North American high growth companies a complete range of private equity funding, from venture capital through to mezzanine debt, management buy-outs and recapitalizations. RBCP takes an active role in the maximization of the value of its investments, by bringing its industry experience and expertise along with the contacts and capabilities of RBC Dominion Securities, Dain Rauscher Wessels and the rest of the Royal Bank Financial Group. RBCP has access to U.S. $650 million in investment capacity for private equity opportunities as well as U.S. $140 million for mezzanine financing. For more information, contact www.rbcap.com.
About Robertson Stephens
Robertson Stephens is a leading underwriter of growth equity offerings. It offers clients a full range of investment banking services, including initial public offerings, follow-on equity offerings, convertible preferred/convertible debentures, off-balance-sheet financings, and private placements.
The companies Robertson Stephens brings to market are some of the industry leaders of the future---high quality growth companies. It is known for its exceptional due diligence in client selection. It has extensive experience and understanding of growth industries in specific business sectors such as Photonics where it utilizes a team of specialists. For more information contact www.robertsonstephens.com.
About Sumitomo Corporation
Sumitomo Corporation plays a key global role in the exchange of goods, services, and technologies among nations and cultures. Sumitomo is one of Japan's largest sogo shosha, or integrated trading companies, and has long been one of the world's largest businesses in terms of sales. Capitalized at about US$1.6 billion, in fiscal 2000 its trading transactions were worth approximately US$103 billion. Sumitomo has almost 8,000 employees and, together with its 737 consolidated subsidiaries and associated companies around the world, employs over 31,000 people. Over the years, the scope of its business has expanded from that of a trader to become an investor, financier, and expediter of ideas. Building on an illustrious tradition that can be traced back four centuries, Sumitomo continues to display a remarkable ability to adapt quickly to the changing times. For more information, contact www.sumitomocorp.co.jp.
About Sumitomo Corporation of America
Sumitomo Corporation of America (SCOA), is a fully integrated trading and investment enterprise with offices in 14 major U.S. cities. SCOA is the largest wholly owned subsidiary of Sumitomo Corporation (SC), an integrated global trading firm with diversified investments and businesses. Established in 1952, and headquartered in New York, SCOA is involved in a wide range of industries, including working on a global scale with SC and subsidiaries to expand on emerging opportunities in information technology industries. www.sumitomocorp.com.
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