Cisco to buy metropolitan network company
Looking for a boost in the high-growth field of metropolitan network equipment, Cisco Systems on Wednesday said it has agreed to acquire privately held upstart AuroraNetics in a stock deal worth up to $150 million.
With the deal, which marks the first acquisition for Cisco this year, the network heavyweight hopes to use AuroraNetics technology to bulk up its optical-equipment products designed to address the rapid growth of data traffic in metropolitan areas. AuroraNetics, based in San Jose, Calif., makes silicon technology for fiber networks that ships Internet traffic at 10 gigabits per second.
Under the terms of its agreement with AuroraNetics, Cisco common stock worth up to $150 million will be exchanged for all outstanding shares of AuroraNetics, which was founded in 2000. The acquisition will be accounted for as a purchase and is expected to close in Cisco's first quarter. The company said it expects to post a one-time charge not to exceed 1 cent per share for expenses tied to the deal. Cisco plans to license AuroraNetics' technology once the deal gets final approval. -- Melanie Austria Farmer, Special to ZDNet News