ACT Networks Bids $8 Million for SourceCom

ACT Networks Inc. has made a bid to buy SourceCom Inc. of Westlake Village, a developer of data transmission technology that recently declared bankruptcy.

The offer was for $8 million, said Giorgio Propersi, SourceCom’s president. Propersi said he was “very pleased” with the offer.

Last week, the company laid off 60 of its 100 workers and filed for Chapter 11 protection, listing more than $10.5 million in debts.

SourceCom manufactures a device built into a computer chip that sorts and routes data over the best available lines in data networks.

ACT Networks, located in Camarillo, develops and manufactures network access products for a wide range of voice, data and integrated network uses.

Called InnerWare, the SourceCom device offers significant advantages over traditional routers, which use multiple chips, require assembly labor and are extremely fragile, said Kieran Taylor of TeleChoice Inc., a telecommunications consultant in Verona, N.J.

This “router on a chip” intelligently routes data traffic to the correct destination in a computer network, Taylor said.

The company took in $6.2 million in revenue in 1996.

ACT Networks is interested in using the platforms SourceCom has developed for frame relay switches, said Andre Defusco, vice president of ACT Networks corporate sales.

The worldwide frame relay market is forecast to reach $3.5 billion annually by the end of 1998, according to industry experts. ACT Networks plans to continue SourceCom’s product line and will absorb many of SourceCom’s engineers, Defusco said. The company’s facilities would remain in Westlake Village.

Bankruptcy hearings on the bid began Monday.