Cisco to acquire Meraki for US$1.2 billion

Cisco to acquire Meraki for US$1.2 billion

Summary: Cisco will buy cloud infrastructure company Meraki for US$1.2 billion

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In its second acquisition in less than three days, Cisco has announced that it will buy cloud infrastructure company Meraki for US$1.2 billion.

Meraki, which offers wireless infrastructure products, was founded in 2006 by MIT candidates with the backing of Sequoia Capital and Google. The company boasts 18,000 customer networks in 145 countries, with customers including Westfield, Burger King, Accor, Radisson, THQ, and the US Department of Energy.

Under the deal, Meraki will become Cisco's new Cloud Networking Group, and the acquisition is expected to be completed in the second quarter of Cisco's fiscal year in 2013.

In a letter to employees, Meraki CEO Sanjit Biswas said that the offer from Cisco had been attractive, and that Cisco understands the team, culture, and environment in Meraki.

"After several weeks of consideration, we decided late last week that joining Cisco was the right path for Meraki, and will help us achieve our goal of having maximum impact. As founders, all three of us plan to stay on as leaders of the business unit, and look forward to continue towards our goal of US$1 billion in annual revenue. We continue to be transparent with you all, and while some things, like our email addresses, etc, will change in our day-to-day operations, we will ensure the important things like our culture stay the same," he said.

Cisco's senior vice president of enterprise networking Rob Soderbery said that Meraki will allow Cisco to offer managed networks to mid-sized businesses.

"Meraki's solution was built from the ground up optimised for cloud with tremendous scale, and is already in use by thousands of customers to manage hundreds of thousands of devices," he said in a statement.

It is the second company that Cisco has announced it will acquire in less than a week, after the company announced on Friday that it would buy datacentre-management software company Cloupia for US$125 million.

Topics: Networking, Cisco, Mobility

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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6 comments
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  • What on Earth is an "MIT Candidate"?

    Was Mittens a "Harvard Candidate".

    -Ramon

    Formerly from MIT
    RamonFHerrera
    • Just a little typo

      I think it was just an editing error where the word "doctoral" or "PhD" was omitted.
      nwilson@...
  • What on Earth is an "MIT Candidate"?

    Was Mittens a "Harvard Candidate".

    -Ramon

    Formerly from MIT
    RamonFHerrera
    • What on Earth is an "MIT Candidate"?

      Speaking of whom, I hear that Mr. Romney was unanimously elected a President of the National Association of Greco-Roman Barbers.
      RamonFHerrera
  • Free Access Point

    I'm not surprised they are being bought because they're an incredible company with rock solid technology. I wonder how much longer they'll offer a free access point ($700 value) for watching a webinar. Here's the link for anybody who wants some free gear:
    http://www.meraki.com/company/webinars?ref=RGSE0q

    Meraki also provides a free Mobile Device Management application that is pretty great. I'm surprised they still off this for free considering the amount of companies charging for similar solutions. BYOD has been driving a strong demand from MDM. Here's the link:
    http://www.meraki.com/products/systems-manager?ref=RGSE0q
    Tony Traino
  • Not happy

    I really like Meraki and I was extremely happy there was some great competition against Cisco with real market differentiators and better prices. Now with Cisco taking them over, I fear they will be assimilated and their key differentiators will be muddled by Cisco. This is not good for the industry, just good for Cisco.

    Color me disappointed that Meraki would agree to this.
    BioDieselUser