JDS Uniphase to Buy IBM Unit

JDS Uniphase Corp. agreed to buy IBM Corp.’s optical-transceiver unit for as much as $425 million to add devices that package several components in a single module.

JDS might pay an additional $85 million in cash or stock in 2003 if the business reaches certain undisclosed goals. The unit, whose parts are used in data storage and corporate networking gear, has 120 employees.

The purchase marks JDS’ first major push into gear that moves traffic through storage or office networks

For IBM, the deal is part of a move to shed less-profitable units within its Technology Group, which also supplies custom semiconductors used in servers, video-game consoles and other devices.

Shares of San Jose-based JDS rose as high as $8.63 in after-hours trading on the news, after closing at $8.40 on Nasdaq. Armonk, N.Y.-based IBM closed up $1.69 at $123.89 on the New York Stock Exchange.