The acquisition comes amidst a growing trend amongst telecom companies worldwide which are increasingly relying on next-generation networks.
In its second acquisition for the month, Cisco asserted that it would pay $35 per share in cash to Starent, around 21 percent more than Monday closing price for the company.
Technology from Starent would help the wireless carriers understand the type of traffic that is passing through their networks, followed by speedy routing of the data received to various mobile devices.
Cisco further asserted that it had also penned contracts to retain the top management of Starent’s board, and had no intentions to trim down its worldwide workforce of 1,000.
Ned Hooper, Cisco’s chief strategy officer, praised Starent Networks by saying, “Obviously, they’ve been a great success story here in the Boston area”, and claimed that the acquisition of the company would help Cisco in meeting the new requirements for wireless data.
Starent Networks was founded around nine years back in 2000, with Ashraf Dahod and Anthony P. Schoener as its co-founders, and the company has fared incredibly well to become a global leader in developing telecom equipments for wireless networks.
Mergers and acquisitions are back with a bang. After Dell with Perot and T-Mobile and Orange, it seems that the technology market is going for another round of consolidation. Cisco is sitting on a cash casket with billions in there so, rather than just waiting for it to grow, it looks as if the network equipment manufacturer is looking to grow it even more.
(San Jose Mercury News)