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It will cost millions more than originally planned, but Ciena Corp. can now go forward with what its CEO called a "tremendous opportunity" after the Columbia networking company said it has been selected as the winning bidder in the auction of assets of Nortel's Metro Ethernet Networks business.

Ciena had announced plans last month to purchase the bankrupt Toronto company's optical networking and Ethernet assets for $390 million in cash and 10 million shares of common stock, for a total value of about $521 million.

The company said Monday it has agreed to pay $530 million in cash and issue $239 million in convertible notes for a total cost of $769 million for the assets. A motion to approve Ciena as the acquirer is to be heard by bankruptcy courts in the U.S. and Canada on Wednesday.

The assets to be acquired generated about $1.36 billion in revenue for Nortel in 2008 and $556 million in the first six months of 2009, according to Ciena information.

"These optical and carrier Ethernet assets bring exceptional technologies, talent and scale that will accelerate Ciena's current strategy to deliver innovative network solutions to customers worldwide," said Gary Smith, Ciena's CEO and president, in a statement.

The companies will combine "complementary technologies" that will help customers shift to automated, optical Ethernet-based networking, Smith said. "We will be intently focused on integration as we work together to deliver the benefits of this transaction to customers, employees and shareholders."

"Ciena provides a natural fit for Nortel's Optical and Carrier Ethernet assets, providing an environment where our businesses' expertise and technology can be grown and leveraged," said Philippe Morin, president, Metro Ethernet Networks for Nortel, in the statement.

Ciena is expected to make employment offers to at least 2,000 Nortel employees. The transaction is expected to close in the first calendar quarter of 2010 and remains subject to regional regulatory clearances and customary closing conditions.