Acacia to be acquired by Cisco for $2.6B
Photo | File
An aerial view of Maynard
Maynard telecommunications manufacturer Acacia Communications is being acquired by California telecom giant Cisco for $2.6 billion.
That news, announced Tuesday morning, sent Acacia’s stock skyrocketing up more than 36% before trading opened on the Nasdaq.
The deal calls for Cisco to pay Acacia $70 per share in cash. That represents a 45.6% premium on Acacia’s closing price on Monday of $48.06.
Cisco is a current Acacia customer and will absorb Acacia and its employees into its optical systems and optics business within its networking and security business.
The San Jose company expects the acquisition to bolster its portfolio of optical, silicon and software technologies in an effort to keep pace with changes in the networking industry.
“With the explosion of bandwidth in the multi-cloud era, optical interconnect technologies are becoming increasingly strategic,” said David Goeckeler, Cisco’s executive vice president and general manager of networking and security, in a statement. “The acquisition of Acacia will allow us to build on the strength of our switching, routing and optical networking portfolio to address our customers' most demanding requirements."
Acquiring Acacia’s technology will allow the growing number of Cisco customers transitioning from chassis-based systems to pluggable technology to simplify operations and reduce network complexities, the company said.
For Acacia, being acquired by a much larger company brings its own benefits: accelerating the pace of technology development and reaching a larger footprint worldwide.
Acacia closed on Monday with a market cap of $1.95 billion, while Cisco closed valued at $240.5 billion.
Cisco ended 2018 with $108.8 billion in assets and 74,200 employees, while Acacia had $601.8 million and 386 employees.
WBJ Web Partners
Most Recent
Most Recent
0 Comments