ACT Networks Gets Court OK to Buy SourceCom

ACT Networks in Camarillo has received bankruptcy court approval to acquire the assets of SourceCom in Westlake Village for $8.6 million.

SourceCom, a high-technology company, filed for protection under Chapter 11 of the U.S. Bankruptcy Code on July 16.

Martin Shum, ACT chairman, president and chief executive officer, said the acquisition will allow his company to enter the emerging telephone gateway server market, which analysts have predicted will grow to $1.8 billion by the end of 2001.

ACT has made offers to approximately 30 SourceCom employees, including 27 engineers. During fiscal 1996, SourceCom generated $6.1 million in revenues.

The SourceCom announcement came shortly after ACT released its fiscal fourth-quarter report, which showed a steep drop in earnings that officials attributed to missed orders and a troubled acquisition.

ACT said net income in the quarter ended June 30 fell 85% to $113,000 or 1 cent a share, from $745,000 or 9 cents a year ago. Revenue increased 48% to $13.45 million from $9.1 million.

Company officials said two major customers in Latin America cut back on orders during the quarter, reducing revenue by more than $2 million from previous estimates.

ACT also said it is having trouble integrating the Dynastar operation, which it bought in February from Dynatech Corp., into its organization.