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CIENA Broadly Expands Service Offerings with Acquisition of ATI Telecom International, Ltd.

Ciena Corporation (Nasdaq: CIEN), today announced it has signed a definitive agreement to acquire privately held ATI Telecom International, Ltd. (Alta), a Canadian corporation headquartered in Norcross, Georgia, U.S., in a transaction valued at approximately $52.5 million. Alta provides a range of engineering, furnishing and installation (EF&I) services for telecommunications service providers in the areas of transport, switching and wireless communications.

Under the terms of the agreement, Ciena will acquire all outstanding shares of Alta in exchange for approximately 890,419 shares of Ciena common stock. The transaction is intended to be accounted for as a pooling of interests and to qualify as a tax-free reorganization. Upon completion of the transaction, Alta will continue operations under its existing name as a wholly owned subsidiary of Ciena.

The transaction has been approved by the boards of directors of both companies and is expected to close in mid-February 1998. Ciena expects that the transaction will have a slight positive impact on its revenue during 1998 and will be modestly accretive to its 1998 earnings.

"As service providers worldwide race to scale their networks to meet the unprecedented demand for greater bandwidth and enhanced service offerings, experienced test and installation resources are becoming scarce," said Patrick Nettles, Ciena's president and chief executive officer. "Many carriers simply cannot physically build their networks rapidly enough to meet growing customer demand."

"Increasingly, Ciena's customers are asking for our help in the area of equipment deployment," continued Nettles. "As a result of this combination, Ciena's customers will get the immediate advantage of Alta's experienced and scaleable workforce. Alta's customers will gain from Ciena's greater financial resources and reputation as an industry leader."

Nettles concluded, "While we do not expect this acquisition to have any near-term impact in driving revenue, it builds on an already solid foundation for longer-term growth."

Alta was formed in April 1993, through a divestiture by Canadian-based Telus Corporation. Alta and its wholly owned subsidiary, Alta Telecom, Inc., are headquartered in Norcross, Georgia and will remain there following completion of the transaction. As a subsidiary of Ciena, Alta will continue to add to its base of approximately 150 full-time employees. In addition, the Company expects to maintain its ongoing relationships with several Canadian telecommunications companies and its as-needed access to their highly skilled contract technicians. At this time, Alta employs approximately 100 such contractors.

Ron Newitt, Alta's president, will remain in that role following completion of the transaction, reporting to Ciena's senior vice president of operations, Mark Cummings. D. Ross Robertson, currently Alta's vice president, will assume the role of vice president of transport deployment for Alta, reporting to Newitt. Ciena's existing EF&I organization will be combined with Alta upon completion of the transaction.

"It was clear from the very beginning of our discussions with Ciena that a formal relationship between the two companies would be highly synergistic, both culturally and in the marketplace," said Ron Newitt, Alta's president. "Ciena and Alta share a customer-focused philosophy and a commitment to unparalleled customer service."

"We are very excited about the addition of the Alta team," said Mark Cummings, Ciena's senior vice president of operations. "Alta offers Ciena's customers immediate access to a breadth of installation experience and extensive field support capability, the equivalent of which would have been challenging and time consuming for Ciena to develop itself."

Stanford Keene of Charlotte, NC, performed acquisition search services related to this transaction on behalf of Ciena.