Cisco Still Short of Needed Shares for Tandberg Deal

Cisco Still Short of Needed Shares for Tandberg Deal

Written By
Jeff Burt
Jeff Burt
Dec 2, 2009
2 minute read
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Cisco Systems is still short of having control of the 90 percent of Tandberg shares it has set as a condition for buying the Norwegian video conferencing equipment vendor.

Cisco officials said Dec. 2 that will wait until after the Dec. 3 deadline to decide whether they have reached the 90 percent threshold. If not, they will either walk away from the $3.4 billion deal or waive the 90 percent requirement, they said.

However, Cisco will not extend the deadline a fourth time.

Currently Cisco has about 84 percent of Tandberg shares committed to the deal.

The vendor is looking to take a strong leadership position in the video conferencing space by buying Tandberg. Cisco already makes number of video conferencing products, including its TelePresence portfolio

What Tandberg would give Cisco is a stronger presence in the small and midsize business markets.

Cisco CEO John Chambers has said that video conferencing is a key piece of the overall $34 billion collaboration space. Video conferencing technology can help reduce travel costs for businesses, and companies like Cisco, Hewlett-Packard, Verizon and others are using it situations where remote communications makes sense, such as enabling doctors to reach patients in rural areas and for remote teaching.

Cisco on Oct. 1 announced its intent to buy Tandberg for $3 billion, a bid that got the backing of Tandberg’s board of directors. However, investors that held almost 30 percent of Tandberg stock said the offer was too low and that they preferred to see Tandberg stay independent or get a better offer from Cisco or some other company.

Cisco on Nov. 17 upped the bid to almost $3.4 billion and extended the deadline to Dec. 1. It then pushed the deadline to Dec. 3.

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