The world optical fibre networks remained one of the few very bright lights in the gloom of tech company market performance in 2000, and the most active in deal terms was JDS Uniphase, which acquired two rivals in friendly transactions. As one of the fastest-growing areas in technology, JDS has been at the forefront of taking the opportunities to grow quickly.
The first, and the only one to clear thus far, was its $15.5 billion takeover of E-Tek. The companies knew each other well; the office of Uniphase, which had merged with JDS Fitel in 1999, was just five minutes' away from E-Tek's in San Jose. The JDS Fitel-Uniphase deal combined a strong active with a strong passive optical filter company, and E-Tek's focus is wave division multiplexing filters. "There has been a short supply of WDM filters," says Ryan Limaye at Goldman Sachs, which took E-Tek public in 1998 and advised on its sale to JDS Uniphase. "They are difficult to make, and E-Tek had done a good job of making its processes as efficient as possible. However by combining with JDS Uniphase that efficiency could be significantly increased to the benefit of their customers."