Cisco to buy Acacia Communications for US$2.8b

[BENGALURU] Network gear maker Cisco Systems Inc said on Tuesday it would buy optical component maker Acacia Communications Inc for US$2.84 billion in cash.

The US$70 per share offer represents a premium of about 46 per cent to Acacia's closing price on Monday.

The deal is Cisco's biggest acquisition for Cisco since its US$3.7-billion purchase of business performance monitoring software company AppDynamics in 2017.

Shares of Acacia rose about 40 per cent to US$67.30, while those of Cisco were down nearly 1 per cent at US$55.80.

Excluding Acacia's cash and marketable securities, the deal is valued at US$2.6 billion, Cisco said.

The acquisition is expected to close in during the second half of Cisco's full year 2020.

Maynard, Massachusetts based Acacia, also a Cisco supplier, designs and manufactures high-speed, optical components, and counts telecom service providers and data center operators as customers. 

REUTERS