Cisco to buy Internet of Things start-up Jasper for $1.4 bn

US-based networking equipment manufacturer,Cisco Systems Inc, yesterday struck a deal to buy privately-held Jasper Technologies Inc, a startup that connects any device – from cars to jet engines to implanted pacemakers over the Internet - for $1.4 billion in cash and equity awards.

Under the terms of the agreement, Cisco will pay $1.4 billion in cash and assumed equity awards, plus additional retention based incentives.

Jasper is a leading Internet of Things (IoT) service platform in terms of number of enterprises and service providers. Many of the world's largest enterprises and service providers are using the Jasper platform to scale their IoT services business globally.

With Jasper, companies can connect any device – from cars to jet engines to implanted pacemakers – over the cellular networks of the top global service providers, and then manage connectivity of IoT services through Jasper's Software as a Service (SaaS) platform.

Jasper develops and provides a SaaS platform with recurring revenue IoT business that manages and drives a wide range of connected devices and services for more than 3500 enterprises worldwide, working with 27 service provider groups globally.

The California-based company, which is backed by investors like Singapore's sovereign wealth fund Temasek, Sequoia Capital and Benchmark Capital, has been recently planning an initial public offering and had banks to help it with listing.

The proposed acquisition will allow Cisco to offer a complete IoT solution that is interoperable across devices and works with IoT service providers, application developers and an ecosystem of partners.

Cisco said that it will continue to build upon the Jasper IoT service platform and add new IoT services such as enterprise Wi-Fi, security for connected devices, and advanced analytics to better manage device usage.

''I am excited about the opportunity for Cisco and Jasper to accelerate how customers recognize the value of the Internet of Things,'' said Chuck Robbins, CEO of Cisco. ''Together, we can enable service providers, enterprises and the broader ecosystem to connect, automate, manage, and analyze billions of connected things, across any network, creating new revenue streams and opportunities.''

''IoT has become a business imperative across the globe. Enterprises in every industry need integrated solutions that give them complete visibility and control over their connected services, while also being simple to implement, manage and scale,'' said Jahangir Mohammed, Jasper CEO.

Jasper CEO Jahangir Mohammed will run the new IoT Software Business Unit under Rowan Trollope, Cisco senior vice president and general manager, IoT and Collaboration Technology Group.

The acquisition is expected to close in the third quarter of fiscal year 2016, subject to customary closing conditions.

Cisco, founded in 1984 has grown to its current stature through numerous acquisitions in the past two decades, beginning with the purchase of LAN switches maker Crescendo Communications in 1993.

The Jasper deal would be its biggest since 2013 after it acquired cyber security solutions provider Sourcefire for $2.7 bn.