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Tech Industry

STOCKS TO WATCH: Nortel, ONI Systems and 3Com

Expect the following technology stocks to be among Monday's most actively traded issues: Nortel, ONI Systems and 3Com.

  • Nortel Networks (NYSE: NT)

    Nortel should be active Monday after it and the Ofek Group will ink a deal Monday giving Nortel preferred supplier status in setting up and integrating a communications network in Israel, the companies said on Sunday.

    Israeli media valued the Ofek-Nortel deal, designed to compete with state-run telecommunications company Bezeq Israel Telecom, at $700 million.

    Over the last 18 months, Ofek looked at numerous competing companies to set up what the company calls one of the most advanced communications networks in the world.

    A trial was held in the Israeli city of Ariel, in which bidders invested millions of dollars.

    Nortel won the tender against France's Alcatel (NYSE: ALA).

    Nortel shares closed up 2.50 to 48.13 Friday.

  • ONI Systems (Nasdaq: ONIS)

    The optical equipment maker will be moving after announcing that it has reached a deal with Japan's Todentsu Corp to deploy and support ONI Systems equipment across Japan.

    "The relationship gives ONI access to Todentsu's experience in engineering, construction, test, turn-up and more, including support from skilled field engineers in 22 major cities across Japan," company official said in a prepared release.

    Todentsu is a major provider of telecommunications equipment installation and service, and its customers include well-known companies in that country like Nippon Telegraph and Telephone Corp (NYSE: NTT).

    The stock closed off more than 3 a share Friday to 69.56.

  • 3Com (Nasdaq: COMS)

    The network-equipment maker will be in for some rough trading Monday after company officials said Friday that it had to pay $259 million to settle to two shareholder class-action lawsuits arising out of its 1997 merger with US Robotics.

    "The terms of the settlement are the outcome of mediation and are a compromise between the parties involved," the company said in a statement, noting that the deal still awaited judicial review and confirmation.

    "There is no admission of liability on the part of 3Com or the individuals named in the lawsuits."

    3Com merged with top modem maker, US Robotics, in June, 1997 in a stock-swap worth $8.5 billion, in what was then touted as a synergistic mega-merger.

    Top executives at 3Com and US Robotics were also accused of selling a total of four million shares for $200 million while the stock was peaking. The stock price later crashed after 3Com belatedly revealed a huge backlog of unsold US Robotics modems, and resulting fiscal losses that had not been originally made public.

    3Com shares finished off 0.31 to 17.19 Friday.

    Reuters contributed to this report.>