Optical gear start-up aims for the Street
Despite having collected no revenue, Corvis files for a public offering of its stock, hoping to take advantage of runaway demand for telecommunications networking technology.
The company, formed by former Ciena founder David Huber, makes optical-based equipment for long-haul communications networks. What makes its technology compelling is a wrinkle that allows voice or data traffic to be routed across a long distance without having to be regenerated at certain points to keep the traffic flowing. As a result, Corvis' technology is extremely fast and cheap to implement.
Columbia, Md.-based Corvis was founded in June 1997. The company has incurred losses of $118 million as of April 1, 2000.
The company said in its filing with the Securities and Exchange Commission that "to date, we have recognized no revenue."
Corvis lists Broadwing Communications Services and Williams Communications as customers, having recently signed deals of $200 million each to supply those companies with its equipment over the next two years. Those deals are subject to the successful completion of ongoing field trials by Broadwing and Williams, the filing said.
The trials are expected to be completed in the second half of this year, according to the filing.
Broadwing and Williams will be offered the opportunity to purchase up to $5 million worth of shares at the public offering price, according to the filing.
"We are in discussions with other service providers to begin field trials and to purchase our products," the company's filing added.
Corvis will compete with start-ups such as Avici Systems, as well as entrenched networking companies such as Nortel Networks, Lucent Technologies and Cisco Systems.
The shares will be offered by an underwriting group managed by Credit Suisse First Boston, Robertson Stephens, Banc of America Securities, Chase H&Q, J.P. Morgan and CIBC World Markets.
The company also said it has recently made two stock acquisitions of optical-based networking companies: French equipment maker Algety Telecom, which is in its development stage, and Baylight Networks of Palo Alto, Calif., which makes network access equipment and subsystems.