Marconi is selling its optical components arm in a £19m deal.

Marconi is off-loading the division to Bookham Technology in return for 9.9 per cent stake in the fibre optics group, valuing the deal at £19.7m.

Marconi chief executive Mike Parton said the agreement was part of the group's strategy of disposing of non-core businesses.

He said there was real value in taking a stake in Bookham.

Based in Caswell, Northamptonshire, with another operation in Chelmsford, Essex, it employs about 500 people.

Bookham president and chief executive Giorgio Anania said: "Integrating Marconi's optical components arm creates a powerful new force in the optical components market place worldwide."

The deal involves Marconi buying a minimum of £30m of components from Bookham over the next 18 months.