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Cisco to buy Starent for $3bn to boost its presence in the mobile web space

City A.M. Reporter
CISCO Systems plans to buy wireless telecommunications equipment maker Starent Networks Corp for $2.9bn (&pound;1.83bn), betting that demand for advanced wireless equipment will grow as more consumers download videos and access the web from mobile phones.<br /><br />In its second major acquisition this month, Cisco said it would pay $35 a share in cash for Starent, a nearly 21 per cent premium on Monday&rsquo;s closing price. Starent shares jumped about 18 per cent in yesterday&rsquo;s trading.<br /><br />For Cisco, the top US network equipment maker, the deal follows the company&rsquo;s&nbsp; 1 October announcement it plans to buy video conferencing equipment maker Tandberg for $3bn.<br /><br />The Starent deal should close in the first half of 2010.<br /><br />Starent makes network equipment that connects radio access networks such as 3G and 4G services with the core network of mobile phone service providers, including Sprint Nextel and Verizon Wireless, a joint venture of Verizon Communications and Vodafone.<br /><br />Some of Starent&rsquo;s equipment competes with Cisco products, as well as those of other networking gear companies such as Alcatel-Lucent and Huawei Technologies.<br /><br />Hilton Romanski, Cisco vice president in corporate development, said that their product portfolios were &ldquo;significantly complementary&rdquo;.