Cisco to Buy Collaboration Company Acano for $700 Million -- Update
November 20 2015 - 3:14PM
Dow Jones News
By Don Clark And Lisa Beilfuss
Cisco Systems Inc. agreed to buy closely held Acano Ltd. for
$700 million in cash, the latest move by the Silicon Valley giant
to expand its videoconferencing and other collaboration
businesses.
Cisco, though best known for networking equipment, was already a
major player in the collaboration market. Prior acquisitions gave
it a formidable portfolio, including the 2010 purchase of the
Norwegian videoconferencing company Tandberg ASA for $3.3 billion
and a 2007 deal to buy Web meeting service WebEx Communications for
$3.2 billion.
The San Jose, Calif., company this month reported that revenue
from collaboration products rose 17% to $1.12 billion in its first
fiscal quarter.
Cisco estimated Friday that only one in 10 corporate conference
rooms are connected with video, vowing to change the ratio to one
in four over the next decade.
Acano, based in London, specializes in hardware that companies
or cloud services install to manage videoconferences. One of its
key selling points is the ability to connect conference room
systems from different hardware providers.
"Our big customers are telling us, 'we want to do more with
Cisco but it has to coexist with our legacy infrastructure,'" said
Rowan Trollope, a senior vice president who is general manager of
Cisco's collaboration technology group. "Acano is the bridge that
makes everything work with everything else."
Another draw is the preference of many companies to let external
cloud providers manage any video communications, Mr. Trollope said.
Cisco already offers such services, which Acano's technology could
enhance, he said.
The company, known for many billion-dollar acquisitions, has
lately expressed a preference for smaller deals while forging
partnerships with large companies. Cisco, for example, this month
announced a broad collaboration with the Swedish telecommunications
equipment company Ericsson AB.
Last month, Cisco struck a deal to buy security specialist
Lancope Inc. for about $453 million. In June Cisco announced a $635
million deal to buy OpenDNS, which maintains a network of
domain-name servers to help route Web traffic and can use that
technology to help block attacks carried out over the Internet.
The Acanos transaction is expected to be completed in Cisco's
quarter ending April 30, Cisco said.
Write to Don Clark at don.clark@wsj.com and Lisa Beilfuss at
lisa.beilfuss@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
November 20, 2015 14:59 ET (19:59 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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