Summary
Cisco Systems, Inc. (CSCO) announced a significant strategic move on July 9, 2019, by entering into a definitive agreement to acquire Acacia Communications, Inc. (ACIA). This acquisition, valued at approximately $2.6 billion on a fully diluted basis, net of cash and marketable securities, involves Cisco paying $70.00 per share in cash for Acacia. The deal is expected to significantly bolster Cisco's optical networking capabilities, integrating Acacia's high-speed optical interconnect technologies, which are crucial for webscale companies, service providers, and data center operators to handle escalating data demands. This acquisition signals Cisco's commitment to enhancing its portfolio in critical growth areas of the networking industry. The integration of Acacia's technology is anticipated to strengthen Cisco's position in the optical market and complement its existing product offerings. Investors should note that the transaction is subject to customary closing conditions and regulatory review, with an expected closing in the second half of Cisco's fiscal year 2020. Until completion, both companies will operate independently.
Key Highlights
- 1Cisco Systems to acquire Acacia Communications for approximately $2.6 billion in cash.
- 2Acacia Communications specializes in high-speed optical interconnect technologies.
- 3The acquisition is expected to enhance Cisco's optical networking capabilities and product portfolio.
- 4The deal price is set at $70.00 per share in cash for Acacia.
- 5The transaction has received approval from the boards of directors of both Cisco and Acacia.
- 6The acquisition is anticipated to close in the second half of Cisco's fiscal year 2020.
- 7Both companies will continue to operate separately until the transaction's completion.