Nortel Networks Buys Clarify

Nortel Networks will pay an estimated $2.1 billion worth of its common shares to buy Clarify’s common shares on a fully diluted basis. Upon completion of the transaction, Clarify will be a wholly owned Nortel Networks subsidiary and will continue to be headquartered in San Jose, California.“Together [Nortel Networks and Clarify] will provide a new customer experience by unifying the high-performance Internet with front office solutions and customer interactions of all kinds,” says F. William Conner, Nortel Networks executive vice president and newly appointed enterprise solutions president.Clarify shareholders will receive a fixed exchange ratio of 1.3 Nortel Networks common shares for each Clarify common stock share. The transaction, expected to close in first-quarter 2000, will be tax-free to Clarify’s U.S. shareholders and neutral to Nortel Networks earnings per share in calendar year 2000 and accretive in 2001, excluding acquisition-related charges. Each company’s board of directors has approved the transaction, which is further subject to Clarify shareholder approval and regulatory compliance.Clarify also granted Nortel Networks an option to purchase up to 19.9 percent of its outstanding common shares