Enterasys earnings data released in SEC filings
New owner Extreme Networks details company’s previous three years of earnings in filings
Enterasys Networks basically broke even in the year before the Salem company was acquired by Extreme Networks -- though during its last three years it lost more than $6.5 million -- according to financial data released Monday to the U.S. Securities and Exchange Commission.
The data was released because Extreme, a publicly traded company on the Nasdaq, has to show what it would have earned with Enterasys, a privately held company, for comparison purposes when it reports future earnings as a combined company.
“There were no surprises,” said John Kurtzweil, chief financial officer of Extreme, which previously had access to the Enterasys data as part of due diligence during the $182 million acquisition, which was completed in October 2013. The deal created an Ethernet switching company with a combined $630 million in sales.
But the information was all new to the public, since Enterasys was previously under no obligation to share financial information.
The data reveals that Enterasys made $119,000 in fiscal 2013 on sales of more than $300 million.
The company had a better year in fiscal 2012, when it made some $2.1 million on $351 million in revenue. Fiscal 2011 was a disappointment, however, with the company losing $8.6 million.
Enterasys started out as a New Hampshire-based public company in 2001, when it was spun off from Rochester-based Cabletron Systems, once the state’s largest employer. But the company soon became engulfed in an accounting scandal that resulted in nine executives being sent to jail, including the CEO and chief financial officer
The company moved to Massachusetts in 2003 and was sold to a private equity firm in 2006 for $386 million. Early last year, it moved back to the Granite state, bringing about 600 jobs to Salem.
While the merged company will be headquartered in San Jose, Calif., its chief operating officer, former Enterasys CEO Chris Crowell, will operate out of Salem.
Before the acquisition, the companies were rivals, so much that the two sued each other twice, according to the SEC filings. In 2012, Enterasys paid Extreme $1 million for court-awarded damages related to a federal suit filed in Wisconsin by Extreme in 2007. And in March 2013, Extreme paid Enterasys $1.8 million in a confidential settlement of suits filed in Wisconsin and Massachusetts back in 2005.