Northern Telecom to Buy Micom for $153 Million

Canada’s Northern Telecom Ltd. said it plans to buy Micom Communications Corp. of Simi Valley for $153 million, including the assumption of debt, to boost its multimedia networking business.

Northern Telecom, which has accumulated profits from its high-speed phone lines and call-routing technology, said it will pay $12 a share for each of Micom’s 11.45 million shares.

The purchase price for the network software company also includes $4 million of debt and more than $1 million in employee-owned stock options, said Robert O’Brien, Northern Telecom spokesman.

The acquisition, which has been recommended by Micom’s board, is expected to be closed by the end of June, O’Brien said.

Northern Telecom said Odyssey Partners L.P. and other Micom shareholders have agreed to tender 5.15 million shares, or 44% of Micom’s total, under the $12-a-share bid.

“People expected Micom to be valued higher,” said Tim Levey, networking analyst at ComVest Partners in Dallas. “Northern Telecom got a good deal.”

Micom has struggled during the past two years to deal with inventory problems at the company and among its customers. For two consecutive years, the company said its third-quarter earnings would fall short of forecasts.