Cisco plans prompt reply to DOJ query on Tandberg buy

Request is part of regulatory process regarding Cisco’s planned acquisition

Cisco Systems Inc. said today that it will respond expeditiously to a request for additional information from the Justice Department, part of the regulatory process regarding Cisco’s planned acquisition of Tandberg ASA.

Cisco said in a statement that it intends to continue to work cooperatively with Justice in connection with its review of the proposed $3.38 billion purchase of the Norwegian company.

On Oct. 1, 2009, Cisco announced a voluntary cash tender offer to acquire all the outstanding shares of Tandberg ASA.

The largest maker of networking equipment now owns about 91 percent of Tandberg shares, which will allow the San Jose, Calif., company to complete the purchase.

Under Norwegian law, a company with more than 90 percent of shares can buy out the remaining shareholders to gain complete control, according to Bloomberg News.

Cisco said it expects the transaction to close during the first half of 2010, the statement said.

Cisco is expanding its telepresence business, including videoconferencing with life-size images of callers that can cost $300,000, Bloomberg reported.

By purchasing the second-largest videoconferencing equipment maker, Cisco will be able to offer lower-cost products in that market and gain a larger share of the $34 billion collaboration market, the business news agency said.

Bloomberg quoted Erik Suppiger, an analyst at Signal Hill Capital Group LLC, as saying, “They view video as paramount to their product road map, and Tandberg is certainly a strong fit.”

Tandberg is the first acquisition outside the United States for Cisco, which has bought more than 130 companies in its 25-year history, Bloomberg said.

About the Author

David Hubler is the former print managing editor for GCN and senior editor for Washington Technology. He is freelance writer living in Annandale, Va.

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