New York: Network equipment maker Cisco Systems plans to buy unified communications company, WebEx Communications Inc., for $2.9 billion. According to Cisco, including WebEx's existing cash, the deal is worth $3.2 billion.
Cisco said it would launch a cash tender offer for all outstanding WebEx shares at $57 each, a premium of 23 percent to the stock's NASDAQ close at $46.20 on Wednesday.
The deal has been approved by the board of directors of both companies and is expected to close during Cisco's fourth quarter ending late July. Cisco said it expects the deal not to affect its full-year 2008 earnings before special items.
WebEx has more than 2 million registered subscribers and helps them hold meetings and share information over the Web.
It's the largest acquisition for Cisco since its $6.9 billion purchase of set-top box maker Scientific Atlanta in 2005. WebEx will help Cisco in its battle against Microsoft in the growing market for unified communications, which are technologies that help collaboration in the workplace, including instant messaging, e-mail, calling services, and letting even far-flung users know when colleagues are unavailable. Cisco and Microsoft are engaged in a battle for attaining supremacy in communications services. On March 14, Microsoft purchased voice-recognition services provider Tellme Networks after Cisco acquired Reactivity, which helps companies improve how they do business over the Web, for $135 million in cash, and Five Across, a provider of social-networking capabilities.
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