Cisco Systems to acquire Scientific-Atlanta

is to acquire

, a provider of set-top boxes and end-to-end video distribution networks and systems.

Under the terms of the agreement, Cisco will pay $43 per share in cash in exchange for each share of Scientific-Atlanta, and assume outstanding options, for an aggregate purchase price of approximately $6.9 billion, or approximately $5.3 billion net of Scientific-Atlanta's existing cash balance.

The acquisition has been approved by the board of directors of each company and is subject to various standard closing conditions, including approval under Hart Scott Rodino and similar laws outside the US and by the shareholders of Scientific-Atlanta.

The deal is expected to close in the third quarter of Cisco's fiscal year 2006.

Prior to that, Cisco and Scientific-Atlanta will operate as separate businesses and will continue to work with their existing partners. After that, Scientific-Atlanta will become a division of Cisco’s Routing and Service Provider Technology Group.

Scientific-Atlanta was founded in 1951 and held its Initial Public Offering (IPO) on July 29, 1959. The company has more than 7500 employees. For FY2005, which ended July 1, 2005, Scientific-Atlanta reported revenues of $1.91 billion.