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UPDATE 2-Ciena folds in Nortel unit, boosts Q3; shrs up

* Q3 adj loss $0.09/shr vs est loss $0.33/shr

* Sales more than double, helped by acquisition

* Sees Q4 rev $409.2 mln vs est $423.9 mln

* Shares rise as much as 7 pct, sector index up 1 pct (Recasts; adds analysts comments)

By NR Sethuraman

BANGALORE, Sept 8 (Reuters) - Ciena Corp's CIEN.O quarterly revenue more than doubled and its smooth integration of a recently acquired Nortel unit calmed investor concerns, sending its shares up 7 percent to an 11-week high.

The company, which last year paid $769 million for Nortel Networks Corp's NRTLQ.PK metro ethernet networks business in its biggest acquisition for 10 years, said May-July revenue jumped to $389.7 million.

Soleil Securities analyst Michael Genovese said there had been “lots of doubts” about the company’s ability to execute the acquisition. “The biggest part of the result is that they have managed the acquisition very well,” he said.

Linthicum, Maryland-based Ciena, reporting its eighth straight quarterly loss, also forecast weak current fourth-quarter revenue.

Ciena, whose rivals include Alcatel-Lucent ALUA.PAALU.N, Cisco Systems CSCO.O, Ericsson ERICb.STERIC.O, Fujitsu 6702.T and Huawei [HWT.UL], supplies optical switches and other gear to AT&T Inc T.N and Verizon Communications Inc VZ.N.

Ciena has product cycles that investors can be bullish about, Genovese said.

Customers’ acceptance of Ciena’s product portfolio, especially in switchings, remains positive over the long-term, said Avondale Partners analyst Blair King.

Ciena shares, which have lost about 31 percent since a year-high on May 3, gained 6.7 percent to $14.32 on Nasdaq Wednesday, while the S&P 1500 Communications Equipment Sub-Industry Index .15GSPCOMM was up 1 percent.

More than 9.5 million shares changed hands by 1351 ET, over twice the normal daily volume. (Reporting by NR Sethuraman in Bangalore; Editing by Gopakumar Warrier, Prem Udayabhanu)

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