Xtera Communications is a privately held company that supplies Optical, IPperformance and service solutions to terrestrial and sub-sea global serviceproviders with development, sales and support offices around the world.

Xtera has been strategically extending both its product portfolio andglobal reach to complement its existing core business with a number ofpreviously announced acquisitions. The acquisition of Meriton is the latestmove in the company's announced growth strategy of strengthening its globalposition in the converged IP and optical communication market and providesthe company with:

--  A carrier class metro transport portfolio that delivers both cross-    connect and ROADM switching, together with sub-wavelength grooming    capabilities--  Proven R&D expertise in innovative Packet Optical Networking/Carrier    Ethernet Transport and ROADM technology--  A global Tier 1 and Tier 2 service provider customer base--  Increased global footprint in the areas of R&D, sales and support    

Xtera is now uniquely positioned to help network operators meet theexplosive growth in Ethernet and IP traffic. The resulting portfoliogreatly enhances the company's ability to provide an agile end-to-endoptical network while allowing service providers to realize the promise oflower operating costs and increased management efficiencies.

"As with our previous acquisitions, Meriton brings advanced technologies,additional customers, and geographical diversity, along with improvedeconomies of scale, across our business," said Xtera CEO Jon Hopper. "Withthis acquisition, Xtera Communications has moved significantly closertoward our goal of being a leading provider of converged Ethernet/IP andOptical Transport solutions."

"Optical networking is showing significant growth in all markets across theglobe," said Michael Howard, Principal Analyst at Infonetics. "Thecontinuing traffic demands for increased capacity are driving the need fornew platforms that converge packet and optical layers to reduce cost andcomplexity in next generation transport networks. Xtera's acquisition ofMeriton Networks creates a wide product portfolio that provides reach fromthe metro access edge through the ultra long haul."

About Xtera Communications

Xtera Communications provides network solutions enabling communicationscompanies to profitably deliver high-bandwidth tailored services at thelowest sustainable cost per bit. Xtera delivers value by combining soundbusiness practice with compelling advantages in capacity, reach, simplicityand service. Further information is available online at www.xtera.com.