PairGain Plans to Sell a Division

PairGain Technologies Inc., the Tustin-based telecommunications equipment maker, said Monday it planned to sell its microelectronics engineering development group.

The company said the sale will let it focus on developing equipment that enables telecommunications carriers to handle various types of traffic, including voice and data. Broadview International is advising the company on the sale of the microelectronics division, which employs 40 engineers. The company said it was in talks with a “short list of interested parties,” said Charles S. Strauch, PairGain’s chairman.

Strauch said it’s “likely that we’ll be selling the group to a well-known entity by year’s end. The backup plan is, if no sale happens, to spin the entity off as a stand-alone company.”

PairGain also said it agreed to pay $2.5 million to an unnamed party to end a joint technology development agreement in connection with the planned divestiture.

PairGain said it would list the $2.5 million as a one-time charge in its fiscal fourth quarter.

PairGain’s shares were up 94 cents on Monday, closing at $15.75 a share.