Mahi networks to leave petaluma
With New Jersey move imminent, fate of 145 workers depends on eventual buyer's plans
Published: Thursday, May 5, 2005 at 3:00 a.m.
Last Modified: Wednesday, May 4, 2005 at 9:00 p.m.
Telecom startup Mahi Networks is planning to sell its Petaluma product line and move its other Sonoma County operations to its New Jersey facility, a company spokesman said Wednesday.
Facts
CLASS OF 1999
Mahi Networks is one of four telecom companies that sprouted in Petaluma six years ago following Cisco Systems' record
$7.3 billion buyout of Cerent Corp.
What happened to the others?
Gluon Networks: Closed its Petaluma facility in January 2004 after burning through $76 million in venture capital.
Calix Networks: Still in business, has 170 employees in Petaluma.
Turin Networks: Still in business, has 150 employees in Petaluma.
"We are going through a transition," said Ron Longo, Mahi's vice president of global marketing. "We have to minimize our operation costs."
The six-year-old company, which has 145 employees at its headquarters on North McDowell Boulevard, has not determined how many jobs will be left after the sale.
The eventual buyer could retain many of the employees and continue to have a presence in Petaluma, Longo said.
Several telecom suppliers are interested in acquiring Mahi's Mi7 networking system, which is designed to help telephone companies manage and switch traffic. The product is part of Mahi's Petaluma-based West Coast switching division, which is also for sale.
Longo wouldn't name the potential buyers, but said they are interested because Mahi is talking with two big carriers about using its Mi7 system.
Other Petaluma operations, including product line management, finance, accounting and manufacturing, will be consolidated with Mahi's Transport Systems Group in South Piscataway, N.J.
Last year, Mahi acquired the New Jersey facility from another networking company, Photuris. The acquisition gave Mahi a wider array of networking equipment to offer large carriers, the company said.
Mahi was part of a group of Petaluma telecom startups that sprouted in 1999 following Cisco Systems's $7.3 billion buyout of Cerent Corp.
Since then, Mahi has raised $255 million, including $70 million in a deal last June intended to expand the Petaluma operation. Mahi also unveiled a new product designed to help cable TV companies handle video, voice and data traffic.
In December, Mahi cut its Petaluma workforce because it was shifting from product development to marketing, according to company officials. Mahi first began selling its products in 2003 following four years of development.
Other Petaluma telecom suppliers including Alcatel have downsized because of the industry's sluggish recovery.
Last October, Mahi named Bill Cadogan, former chief executive of ADC Telecom, to replace Mahi chief Chris Rust, one of the company's founders.
This story appeared in print on page 1
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