A publicly traded Roanoke company has completed a carefully planned transformation that establishes it as a company with a pure focus on the future of fiber optics.
Luna Innovations began three decades ago as a research and development team looking for projects on a wide range of fronts.
However, that fuzzy mission has been in constant flux over the past decade, fueled by a conviction among Luna’s leaders that it should get involved in its fiber-optic division.
“Fiber optics is the future. That’s what we’re relying on,” Luna Chairman and CEO Scott Graeff said, adding that the move allows the company to move forward with a clear mission and a clear identity for communicating with investors and customers.
Luna’s evolution occurred in stages as the company selected other fiber optic companies to strengthen its portfolio and shed other holdings that no longer fit its renewed mission.
In March, the company announced that its reinvention was complete. In one fell swoop, it made a major acquisition in Europe and spun off the last remaining division that wasn’t focused on fiber optic work.
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The sale of Luna Labs, which is moving forward as an employee-owned operation, is a milestone with both pragmatic and symbolic significance, as the research lab was the original base for Luna Innovations when it was first launched in 1990.
The lab, now headquartered in Charlottesville where it has a staff of about 100, will continue to be a success, Graeff said, seeking advances in everything from developing high-performance materials to bioscience research.
The lab, in which Luna has a 5% stake, has created products ranging from a hyper-realistic facsimile of blood used in medical training to a car coating that repels water and mud. Their products are successful, Graeff said.
But it no longer fit with Luna’s new approach. Additionally, being tied to a publicly traded company imposes limits on the type of partnerships the research lab could expand into.
Luna took her time putting together the right home for the lab, an important part of the company’s history, Graeff said.
The opportunity to acquire Germany-based LIOS Sensing, which has a portfolio of around 800 active and pending patents, gave the talks additional purpose. The LIOS deal closed for the equivalent of about $22 million.
The sale of Luna Labs, which Luna worked with employees to organize, yielded about $21 million that made the purchase possible.
The result is perhaps the most transformative milestone in the company’s life, Graeff said.
Luna Innovations now has around 400 employees in locations around the world. It specializes in using fiber-optic technology to create sensors and measurement tools that can generate real-time data on everything from how much stress is being exerted on an airplane wing to whether a perimeter fence remains secure.
LIOS offered strong expertise in distributed temperature sensing technology, a complement to Luna’s work, as well as an attractive footprint in high-growth markets such as oilfield services and railways, according to information published by Luna.
