Cisco Systems announced today, December 14, 2000, a definitive agreement to acquire privately-held ExiO Communications for approximately US$155 million. ExiO is a developer of in-building, wireless technologies for corporate networks based on standard, Code Division Multiple Access (CDMA) technologies.
Under the terms of the agreement, Cisco common stock worth an aggregate value of approximately $155 million will be exchanged for all outstanding shares and options of ExiO.
The acquisition will be accounted for as a purchase and is expected to be complete in the third quarter of Cisco’s fiscal year 2001.
In connection with the acquisition, Cisco expects a one-time charge of approximately $.01 per share on an after-tax basis for purchased in-process research and development expenses.
The acquisition of ExiO is believed to enhance Cisco’s strategy for addressing the in-building wireless market that requires a solution based on next-generation CDMA technologies.
ExiO’s wireless telephony solution also builds on Cisco’s existing wireless technology that enables enterprise customers to add the convenience of mobility to voice-over-IP (Internet Protocol) services.
The Mobile Wireless Internet is expected to be a large and fast growing market, serving more than one billion subscribers by 2004.
Third-generation wireless networks will be based on the Internet Protocol and merge with the Internet as it exists today.
According to a statement, the acquisition of ExiO further strengthens Cisco’s commitment to the development of a fully converged network, which supports multiple wireless standards, including GSM and CDMA for integrated mobile voice and data services.
The deal is the 22nd announced by Cisco this year. The San Jose-based company previously said it planned to make 20 to 25 acquisitions in 2000.