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Cabletron sets date for Enterasys spin-off

Cabletron sets date for Enterasys spin-off

Cabletron Systems has announced that August 6 will be the day the company rides into the sunset by completing the final spin-offs of its subsidiary companies.

In a conference call, Cabletron chief executive officer Piyush Patel said Cabletron subsidiary Enterasys Networks will become its own publicly traded company on August 6, listed on the New York Stock Exchange as ETS. For each Cabletron share held, shareholders will receive two Enterasys shares. Also on August 6, Cabletron stockholders will receive 1.02 shares of Riverstone stock for each Cabletron share they hold.

Network management software maker Aprisma will become a wholly owned subsidiary of Enterasys until Aprisma is also spun off. Cabletron officials said they anticipate that will happen by December 31, either by initial public offering or, more likely, by direct spin-off to Cabletron shareholders. Until then, Aprisma will operate as it did under Cabletron, reporting separate financials and lead independently by its present CEO, Michael Skubisz.

After this spin-off of Cabletron stock to shareholders, Cabletron will cease to exist and will stop trading publicly, as its shares will be distributed to Riverstone and Enterasys stockholders. Patel said he will continue to work with the independent companies as an advisor, but did not say what his official title would be.

Riverstone was the first Cabletron company to go public. Since its IPO in February, the company's stock has risen almost 32 per cent.

While under Cabletron's wing, Enterasys also fared well. Since Cabletron created the company in February 2000, Enterasys has established itself as a player in the enterprise market. Last year, the firm was second only to Cisco in Layer 3 Ethernet and Gigabit Ethernet switch port shipments, according to IDC. As a public company, says CEO Henry Fiallo, Enterasys will have more autonomy to operate and make acquisitions.

It is un-known at this stage how the announcement will affect Cabletron's Australian operations.


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