Kanata optical networking technology provider Optelian acquired by Texas firm

Fibre optics

An Ottawa firm that specializes in “hardened” optical networking technology designed to withstand extreme heat, cold and humidity has been sold to a U.S. company.

DZS, a publicly traded networking solutions provider based in Plano, Tex., said this week it has acquired Optelian, a 35-person company headquartered in Kanata. Financial terms of the deal, which is expected to close in the next 30 days, were not disclosed. 

Founded in 2002, Optelian is known for its products that help major internet and cellular service providers deliver wireless data to “the edge of the network,” where high-speed fibre-optic technology is often housed in outdoor compartments that are exposed to brutally cold temperatures in winter and hot, humid conditions in the summer. 

The firm’s “long-haul” hardware and software help big telcos extend their 5G networks farther into remote areas that aren’t well-served by major wireless infrastructure such as cellular towers.

Optelian has a significant presence in North America, selling to five of the top six telecom service providers south of the border as well as about 50 smaller customers throughout Canada and the U.S. But co-founder and CEO Dave Weymouth said he’s hoping the deal with DZS, which does business in more than 100 countries, can help it penetrate into global markets.

'Good things' coming

“We’re really excited,” he said. “There’s going to be growth with our team here in Ottawa and more R&D. There’s going to be a lot of good things coming out of (the transaction).”

Indeed, Optelian is back in the headlines after years of staying under the radar. 

Weymouth and Optelian president Mike Perry, who’s based at Optelian’s U.S. office in Marietta, Ga., built the firm into one of the capital’s rising tech stars a decade ago on the strength of its fibre-optic transport solution that could transmit 100 gigabits of data per second.

The bootstrapped firm made three straight appearances on OBJ’s fastest-growing companies list, growing its local headcount to 175 employees in 2013. But Optelian then experienced a few lean years, prompting it to dramatically trim its workforce and do a “rethink of where we needed to be,” Weymouth said. “We’ve gone through our ups and downs.”

Shift in focus

After getting feedback from its major customers, the Ottawa firm decided to shift its focus four years ago to the “edge of the network” in the hope of finding fertile ground for renewed growth. 

Its robust technology eventually caught the eye of bigger players, including DZS. The Texas firm’s CEO, Charlie Vogt, contacted Weymouth last fall to explore the idea of bringing Optelian under its umbrella.   

From there, Weymouth said, “it just sort of rolled along. The timing just worked out for both sides.”

DZS chief marketing officer Geoff Burke said both companies see plenty of upside in combining their operations. 

He said the deal will give DZS new network technology capabilities and a stronger base in North America, while Optelian’s products ​– which will be rebranded as DZS’s “O” series ​– will “find some homes in other places in the world.”

Weymouth, who plans to stay with the company, predicts there will be continued expansion of Optelian’s operations in the capital region.

“There’s good talent in Ottawa, especially for optics,” he said. “We’re known for that.”