Verso buys iMarc line from Zhone subsidiary

Telecom equipment maker will focus production here

Verso Technologies Inc. has purchased the iMarc product line from Paradyne Networks Inc., a subsidiary of Zhone Technologies Inc.

The $2.5 million acquisition will expand the telecommunications equipment maker's customer base and allow it to consolidate production in Huntsville, the company said in a news release.

"We're going to make Huntsville our production facility for all of our products," said Steven A. Odom, executive chairman of Verso. He said engineering duties will be split between Huntsville and Verso's Montreal facility.

The Huntsville operation currently has about 30 employees, down from about 70 last summer. The company plans to add about five employees, Odom said.

Last July, Atlanta-based Verso bought Verilink Corp., which had a production operation in Huntsville, for $5.8 million. Verilink's assets were auctioned as part of its bankruptcy proceedings earlier last year.

In 2005, Verilink had purchased two other product lines from Zhone Technologies.

Verso said it has served as a reseller of Zhone's products.

The company said iMarc's product line complement's Verso's WanSuite line, enabling new services to be deployed faster and increase reliability of existing service.

The acquisition is expected to be completed in the second quarter. Zhone will continue to serve as a contract manufacturer to Verso for about six months, then Verso will purchase the inventory relating to the iMarc product line, the company said. Verso, which trades on the Nasdaq under the symbol VRSO, closed at $1.17, down 1 cent.