FAR EAST GETS CLOSE LUMINENT'S FUTURE LINKED WITH TAIWAN.

Byline: Evan Pondel Staff Writer

CHATSWORTH - Luminent Inc. signed a pact with Taiwan's Ministry of Economic affairs Tuesday to fortify the fiber-optic maker's relationship with the government and formally establish its presence in an area dominated by information technology.

The move comes almost a month after Luminent reported a net loss of $66 million for the quarter ended June 30, or 42 cents per share, compared with a net loss of $22.3 million, or 14 cents a share, year ago.

Luminent's net sales for the second quarter were $41.1 million, versus $28.1 million for the same period a year ago.

Last month, the company said it would close three facilities in the United States and two in Taiwan, reducing its worldwide facilities to seven, while cutting about 600 jobs.

Flanked by U.S. and Taiwanese flags in a conference room at Luminent's Chatsworth headquarters, company President and Chief Executive Officer William Spivey and Chii-ming Yiin, vice minister of Taiwan's Ministry of Economic Affairs, discussed the company's outlook in a sector that's been battered by job losses and shrinking sales.

In one three-month period, for example, 250,000 people worldwide in the telecommunications industry are estimated to have lost their jobs. And in the United States, an estimated 54,000 people lost jobs in the fiber-optic component sector.

``Although we may be in a near-term industry pause, the long-term outlook is bright with substantial growth opportunities,'' Spivey said.

To increase the company's stronghold in Asia, Luminent recently acquired Fiber Optic Components Inc., a Taiwan-based manufacturer that has operations in Shanghai, China. Luminent also completed its acquisition of Taiwan-based Optronics International Corp.

``These acquisitions speak to the commitment to the Taiwan industry,'' Spivey said.

Instead of exploring another country to broaden its market share, Spivey said Taiwan's economy was a natural fit for Luminent.

``And this is a continuation of our strategy to invest and grow our business - it's a natural next step,'' he said.

Despite the company's attempt to proliferate in Asia, political tensions between China and Taiwan pose obstacles for many businesses.

``The political climate has to improve so companies aren't nervous to have a presence in both Taiwan and China,'' Spivey said.

But Chii-ming is candidly optimistic about the ability of U.S. businesses to cut through the red tape.

``Business and politics are separate in Taiwan and China,'' he said. ``For foreign companies, Taiwan is a strong gateway to Asia.''

When Spivey asked a question at the conference about Taiwan's research and development capabilities, a few eyebrows were raised as officials from the ministry's office responded quickly, praising the quality of the country's engineers.

``R and D talent is very difficult to find - we're having a hard time with the education,'' Spivey said.

Luminent is a offshoot of MRV Communications, an incubator of fiber-optic companies.

Chatsworth-based MRV spun Luminent off in April 2000.

Among Luminent's competitors are behemoths IBM, Lucent and Agilent Technologies.

Shares of Luminent declined 4 cents Tuesday, or 1.43 percent, to $2.76.

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Photo:

(1 -- 2 -- color) Luminent supervisor Vu Dang shows one of the transceivers, above, made by assemblers like An Huynh, below, at the fiber-optic company's Chatsworth plant.

Evan Yee/Staff Photographer