Calix (s CALX), a Petaluma, Calif.-based maker of next-generation broadband access gear said it will buy Occam Networks (s OCNW) of Santa Barbara, Calif., for $171 million in a stock and cash transaction. The deal values Occam at $7.75 a share: a 27-percent premium for Occam’s current stock price. Nearly half that amount — about $3.84 a share – will be paid in cash. Calix is headed by CEO Carl Russo, formerly of Cerent, an optical startup that was acquired by Cisco Systems (s CSCO) for about $8 billion towards the end of last decade.

Both companies make broadband access equipment and are primarily targeted at carriers (especially rural and independent carriers) that are building optics-based networks and offering triple-play services. Occam’s expertise is in IP and Ethernet, while Calix is particularly strong in fiber access. Calix went public in March of this year, and this is a good indication of company’s plans: Buy and bulk up fast.

Bottomline: As standalone companies, both Occam and Calix were too small and faced competition from much bigger rivals such as ADC Telecommunications (s ADCT). They also had incomplete portfolios. This is a good combination and a great opportunity for these companies to vie for business from some of the larger broadband service providers who typically opt for the Alcatel-Lucents (S ALU) and Huaweis of the world.

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