Cisco is moving ahead with the $3.4 billion purchase of Tandberg despite not getting control of the desired 90 percent of shares. As of the Dec. 3 deadline, Cisco has gained control of 89 percent of the shares, and officials waived the requirement. The move will make Cisco the top video conferencing company in the world, and a larger player in the overall $34 billion collaboration space.
Cisco Systems is going ahead with the $3.4 billion acquisition of
Tandberg, despite not getting the number of shares it was seeking.
Cisco officials announced Dec. 3 that it will buy the Norwegian
company, creating the largest video conferencing vendor in the world.
Cisco initially had sought the backing of Tandberg investors who
held at least 90 percent of shares. As of the Dec. 3 deadline, Cisco
had collected 89 percent of the Tandberg shares. However, Cisco
officials said they will waive the 90 percent requirement.
In October, Cisco announced its intention to buy Tandberg for $3
billion, a bid that Tandberg's board of directors approved but a number
of shareholders holding almost 30 percent of the stock rejected as
being too low.
Cisco officials had threatened to walk away from the deal, though
analysts predicted the company would eventually go through with it.
Cisco offers high-end video conferencing equipment for enterprises,
while Tandberg will give it a greater SMB presence.
Last month, Cisco upped its offer to $3.4 billion, and extended the deadline
times in hopes of reaching the desired 90 percent of shares. Company
officials promised that they would not increase the offer, and that the
Dec. 3 deadline would be the last.
Tandberg's video conferencing and telepresence will be a key part of
what Cisco officials say is a $34 billion collaboration market. The
video conferencing space is a competitive one, with such vendors as
Hewlett-Packard, Polycom and Logitech-with its $405 million acquisition
of LifeSize-as key players.
Cisco-which ended the third quarter with more than $35 billion in
cash-has been aggressive in its acquisition strategy, as illustrated by
its purchase of Pure Digital Technology and its Flip Video products in
May and its $2.9 billion offer in October for wireless infrastructure
vendor Starent Networks