Olicom's fire sale rages

Olicom's fire sale rages

Olicom's networking run has all but come to an end after Intel announced last week it will buy the company's development group.

The news comes as Olicom's remaining Asia-Pacific employee and Australia/New Zealand managing director, Claus Hansen, told ARN he plans to close all of Olicom's regional offices.

Hansen said he intends to close Olicom's Japanese, Singaporean and Australian offices shortly and is cur-rently in negotiations regarding on-going customer support arrangements.

"I will be leaving as well, probably in December," Hansen revealed.

Olicom's fire sale continues the planned sell-off of its assets amid deep financial losses at the Danish company.

It also follows the company's announcement late last month that Madge will purchase its token ring business for $15 million in cash.

Olicom has signed an agreement that will give Intel a group of around 220 Olicom staff based in Copenhagen and Gdansk, Poland, Olicom said in a statement last week.

In addition, Intel will also buy intellectual property and other assets related to the Danish company's development group. Financial terms of the deal were not disclosed.

Hansen said the deal is positive in that Olicom's development staff will move across to Intel. "It's great for Olicom because we are fulfilling our obligations," he said.

Taking on the Olicom staff will more than double the current number of European developers working on network systems products at Intel, Olicom said.

The deal will give the US chip giant its first Polish development site.

Intel this year has steadily expanded its presence in the networking market largely through acquisitions. In March, it bought Level One Communications, a maker of telecom and networking connectivity products, for $US2.2 billion.

Olicom also said last week that it plans to offload its majority hold- ing in local wireless communications tech-nology provider Digianswer, which it acquired in the first quarter of this year.

Olicom has been hit by serious losses stemming from a steep decline in sales of its token ring products this year, the vendor said.

Olicom opted to sell off its assets one by one after a plan to form a Fast Ethernet alliance failed and attempts to sell off the company as a whole met with no success.

Even after the recent sell-offs, the book value of Olicom's equity is close to zero, the company reports.

Olicom is expected to make its balance sheets publicly available in the next week.

Despite the troubles, Olicom claims it will stay in business and service its existing customers.

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