Cisco Snags Tandberg for $3 Billion
by John Paczkowski
Posted on October 1, 2009 at 7:35 AM PT
Dell (DELL) buys Perot Systems (PER) for $3.9 billion. Then Xerox (XRX) purchases Affiliated Computer Services (ACS) for $6.4 billion. Now Cisco is acquiring Tandberg.
Cisco (CSCO) will pay nearly $3 billion in cash for the Norwegian videoconference company, which it hopes will bolster its position in videoconferencing. The offer values Tandberg at 11 percent more than its closing price in Oslo trading yesterday and at about 23 times 2010 earnings. But the company’s lower-end TelePresence systems and specialized software for managing teleconferences will do much to help Cisco dominate the $34 billion collaboration market.
It’s worth noting that earlier this year, Gartner (IT) forecast that video telepresence could replace 2.1 million business travel flights a year by 2012, diverting $3.5 billion annually from the airline industry.
“This fits very well with Cisco,” Robeco NV’s Michiel Plakman told Bloomberg. “They will immediately become the most important player in the market and aren’t paying a ridiculous premium, so this is positive.”
Cisco’s tender offer has the recommendation of the Tandberg board and is expected to close in the first half of next year.
Comments
Crangle better start tugging harder on Hurd and Robison’s sleeves and get them to pony up for Polycom. Good luck playing catch up, Camerata!
Posted by Danny Miller at October 1st, 2009 at 5:46 pm