After more than a year and a half of waiting and a last-minute hiccup that almost foundered the deal, Cisco (NASDAQ: CSCO) says it has finally closed its acquisition of Acacia Communications, Inc. (NASDAQ: ACIA). Approval by a majority of Acacia’s shareholders was the last step in the process, which sees Cisco buy the developer of optical transceivers and coherent DSPs for $115.00 per share in cash, or approximately $4.5 billion on a fully diluted basis, net of cash and marketable securities.
Cisco says its previously stated plans for Acacia technology to remain available on the open market haven’t changed. “[W]e want to increase our relevance for customers purchasing pluggables today – even for non-Cisco hosts. We are confident that we bring unique value to our customers who want to procure optics and can provide them with confidence that Cisco optics will work in any third-party host,” wrote Bill Gartner, senior vice president and general manager of Cisco’s Optical Systems & Optics Group, in a blog posted today. Acacia will be integrated into Cisco’s Optics business as part of the Mass-Scale Infrastructure Group. “As Cisco and Acacia come together, Cisco is committed to supporting Acacia’s existing customers and new customers that want industry-leading coherent optics, digital signal processing/photonic integrated circuit modules, and transceivers for use in networking products and data centers.”
Acacia has notified NASDAQ of the completion of the deal and has requested that NASDAQ file a notification of delisting with the Securities and Exchange Commission on Acacia’s behalf.
The two companies signed the sales agreement in July 2019, with an eye toward completing the deal in the second half of Cisco’s fiscal 2020 (see “Cisco to buy Acacia Communications for optical transceiver, components play”). However, gaining necessary approval from China’s (SAMR) proved problematic (see “Cisco, Acacia Communications optimistic about merger approval from China”). Meanwhile, Acacia’s perceived value, particularly in light of the recent valuation of Inphi through its acquisition agreement with Marvell, convinced Acacia management that it was now selling itself cheaply, leading them to try to back out of the agreement (see “Acacia Communications says Cisco merger is off; Cisco disagrees”). The two companies renegotiated the acquisition at a higher price (see “Cisco, Acacia Communications renegotiate merger at higher price”), and SAMR finally gave the deal a formal blessing a short time later.
“We are thrilled to welcome the Acacia team to Cisco,” said Chuck Robbins, Cisco chairman and CEO. “Our Internet for the Future strategy puts Acacia’s high-speed coherent optics technologies front and center as we work to empower webscale companies, service providers, and data center operators to meet today’s fast-growing demands for data.”
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