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Maryland saw more, but much smaller, mergers and acquisitions in the third quarter than a year ago.

While there were 59 deals in the quarter, compared with 56 a year ago, the average disclosed deal fell sharply to $53.2 million from $96.8 million, according to data company FactSet Mergerstat. Fewer than a quarter of the transactions disclosed purchase prices.

The state's average could rise this quarter, due to one deal announced this month. Ciena Corp., a Linthicum networking equipment company, agreed to purchase the optical and Ethernet business of bankrupt Nortel Networks in a $521 million stock-and-cash deal.

But that purchase isn't guaranteed, because bankruptcy proceedings require the Canadian company to hold an auction that could attract a higher bidder, plus obtain regulatory approval.

If the transaction is completed, Ciena will gain much greater geographic reach, broaden its customer base and accelerate its pace of growth plans, among other benefits, Gary Smith, Ciena's CEO and president, said during a conference call.

"These are all things that we believe Ciena can achieve on our own. But we believe this transaction gives us the opportunity to simply get there faster," Smith said.

Some mergers and acquisitions are being conducted through bargain hunting by one party, or as a way to survive by a struggling company in leaner economic times, as with an agreement with beleaguered Rockville deaf-services company Viable this year to be bought by a New York competitor.

That was not the case in the Ciena agreement, which the parties have been working on carefully for about a year, said Nicole Anderson, a Ciena spokeswoman. Ciena's last completed acquisition was about 18 months ago, she said.

"It had nothing to do with the current economic climate," Anderson said.

The largest deal on FactSet's third-quarter list involving Maryland businesses was the $400 million sale by Bethesda private equity firm American Capital of Axygen BioScience and its subsidiaries to Corning Inc.

American Capital received $182 million in proceeds and realized a gain of $35 million from the transaction. The 22 percent return on the Axygen BioScience investment was an outstanding outcome for American Capital and its shareholders, executives said.

Like many equity firms, American Capital's bottom line has been dismal of late. The company reported a net loss of $547 million in the second quarter.

American Capital believes the worst is over, CFO John Erickson said in a statement.

"Our experience from the last recession leads us to believe that we will recover value in our portfolio companies as the economy strengthens," Erickson said. "Despite having depreciation in some of our investments, we also have many fine investments. ... With our large and diverse portfolio, we continue to generate liquidity despite the poor mergers and acquisitions environment."

Bethesda military and aerospace giant Lockheed Martin has completed three acquisitions this year, after four last year.

The latest was Gyrocam Systems, a Sarasota, Fla., surveillance technologies company. Robert J. Stevens, Lockheed's president and CEO, called the transaction "a sound strategic fit that strengthens a core competency while addressing a customer priority."

Companies that completed deals globally in the first nine months this year outperformed the Morgan Stanley Capital International World Index by 2.6 percent, according to a study released this week by consulting firm Towers Perrin. But that performance declined in the third quarter, as those who avoided mergers and acquisitions fared better than those that made deals.

"Bargain hunters in early 2009 were able to capitalize on good assets at reduced prices," Mary Cianni, leader of Towers Perrin's global mergers and acquisitions practice, said in a statement. "But as confidence returned to the market, buyers needed to choose targets where they could really add value."