Fiber optic supplier CommScope, Inc. announced 16 May 2003 that it expects to take charges from its minority stake in OFS BrightWave, LLC, an optical fiber and fiber cable venture with The Furukawa El…
Fiber optic supplier CommScope, Inc. announced 16 May 2003 that it expects to take charges from its minority stake in OFS BrightWave, LLC, an optical fiber and fiber cable venture with The Furukawa Electric Co., Ltd. of Japan. Earlier in the day Furukawa announced a major review of its worldwide optical fiber and fiber optic cable operations, which may include some OFS BrightWave facilities where CommScope has a minority stake. Furukawa made it known that additional restructuring, charges and job cuts may be required at certain fiber plants in order to reduce its cost structure. “We believe that Furukawa is continuing to respond to the unprecedented downturn in global business conditions for optical fiber and fiber optic cable,” said Frank M. Drendel, CommScope Chairman and Chief Executive Officer. “As we stated in our recent earnings release, CommScope expects ongoing pricing pressures and weak global demand for optical fiber products at least through 2003. Furukawa stated today that it intends to take additional actions in response to current market conditions.” “CommScope expects to provide estimates of non-cash charges related to OFS BrightWave once plans are finalized in the coming months,” noted Drendel. CommScope bought an 18.4% stake in OFS BrightWave, an optical fiber and fiber cable venture between CommScope and Furukawa, during the 4Q of 2001 and CommScope is reporting results using the equity method of accounting for this investment. CommScope is the world“s largest manufacturer of broadband coaxial cable for Hybrid Fiber Coaxial (HFC) applications and a supplier of high-performance fiber optic and twisted pair cables for LAN, wireless and other communications applications. Through its relationship with OFS, CommScope has a stake in one of the world“s largest producers of optical fiber and cable and has access to a wide range of connectivity components as well as advanced optical fibers, including the zero water peak optical fibers used in the production of the LightScope ZWP(TM) range of products.