CIENA CORP., the fast-growing Linthicum high-technology company, is another example that success can be a double-edged sword.
The company was so good at making devices that increase the volume of information transmitted through telephone fiber-optic cables that it became a highly attractive target for acquisition. The downside is that Maryland loses the headquarters of a dynamic corporation.
Tellabs Inc., an Illinois communication equipment manufacturer, has agreed to pay Ciena's stockholders $6.9 billion to acquire the fledging company. Most of the stockholders, including the top officers, venture capitalists and institutions, are reaping profits in the hundreds of millions of dollars.
The implications for the state's economic development strategy of nurturing high-growth, high-techcompanies are encouraging. The company, which moved to Maryland from Texas in 1994, grew from a handful of employees to its current 1,300. With Tellabs' marketing strength, Ciena's sales are likely to grow at an even faster clip, meaning it will continue to generate jobs and taxes for the state.
Still, it is a bit unsettling. This is the second time in six weeks that a home-grown telecommunications company has been acquired. In April, Lucent Technologies acquired Yurie Systems Inc., a small Landover networking company, for $1 billion.
In past years, venerable local corporations such as Alex. Brown & Sons, Noxell and USF&G; have been bought out. All of Baltimore's biggest commercial banks, with the exception of Mercantile Bankshares, are owned by out-of-state companies. The turnover may have helped worsen a corporate void in civic life.
Tellabs' top executives say that Ciena's operations will remain in Maryland. Considering that the company has been adding employees to its manufacturing, research and marketing staff, this is good news. Better news would be that Tellabs is moving its headquarters to Maryland.
Pub Date: 6/13/98