Cisco has announced its intention to acquire BroadSoft in a deal worth $1.9 billion.
On Monday, the networking giant said the companies have entered into a definitive agreement over the buyout, which has also been approved by both the Cisco and BroadSoft boards of directors.
Cisco says that BroadSoft, a US cloud PBX, unified communications, team collaboration, and contact center solutions company will be utilized to offer enterprise clients a wider range of enterprise-based collaboration tools and solutions.
Cisco will pay $55 per share in cash in exchange for each BroadSoft share to finalize the $1.9 billion deal.
Cisco will also take on Gaithersburg, MD-based BroadSoft's debt.
The tech giant says that Unified communications are at the heart of the deal. Enterprise clients need collaboration tools as well as voice and contact centers to operate modern-day businesses successfully.
The firm hopes that by combining BroadSoft's portfolio with Cisco's meetings, hardware, and services solutions, Cisco will be able to better cater to enterprise requirements as well as SMBs.
"Together, Cisco and BroadSoft will deliver a robust suite of collaboration capabilities across every market segment," said Rowan Trollope, senior vice president and general manager of Cisco's Applications Business Group. "We believe that our combined offers, from Cisco's collaboration technology for enterprises to BroadSoft's suite for small and medium businesses delivered through Service Providers will give customers more choice and flexibility."
Until the acquisition is complete, Cisco and BroadSoft will continue to operate independently. Once the buyout is finished, BroadSoft employees will join Cisco's Unified Communications Technology Group, under the Applications Group.
The buyout is expected to close in Q1 2018, following regulatory approval.
Last week, Cisco snapped up Perspica, a company which specializes in data analysis through machine learning algorithms. The acquisition is intended to bolter AppDynamics' activities, a firm purchased by Cisco in January in a deal valued at $3.7 billion.