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Lucent to Split Optical Business in Two; Names New Presidents for Units

August 04, 2000|From Bloomberg News

MURRAY HILL, N.J. — Lucent Technologies Inc., the No. 1 maker of phone equipment, said Thursday it will split its optical networking business into two units and announced the retirement of the group's president, Harry Bosco.

Lucent appointed Jeong Kim, the business' chief operating officer, president of a unit that makes gear to beam traffic across long-distance optical networks. Bob Barron, who joined Lucent in June when it bought Chromatis Networks Inc., will lead the division that makes equipment used in regional, so-called metro fiber-optic networks.

Chief Executive Richard McGinn promised management changes on July 20 after warning profit would lag forecasts for the next two quarters. Bosco ran a unit that last year underestimated when customers would want optical equipment that moves information at faster speeds. The misstep gave rivals Nortel Networks Corp. and Ciena Corp. a lead in selling their new gear.

Both Kim, 39, and Barron, 43, ended up at Lucent after the companies they helped run were acquired. Kim co-founded Yurie Systems Inc., bought by Lucent for $963.6 million in May 1998; Barron was chief executive at Chromatis, acquired for $4.48 billion.

Bosco, 55, retires after 35 years with Lucent and AT&T Corp., which spun off Lucent in 1996.

The Murray Hill, N.J.-based company said it split the fiber-optic equipment business to align each unit with other product lines that address similar customer needs.

The metro optical unit joins Lucent's InterNetworking Systems Group, which also sells gear used to deliver high-speed Internet connections. Kim's half of the optical networking unit becomes part of Lucent's Service Provider Networks group.

Lucent shares fell $1.56 to close at $43.31 in trading on the New York Stock Exchange. They've plunged 42% this year.

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