Cisco to acquire BroadSoft in $1.9 billion deal

Posted October 25, 2017

News that Cisco was planning on acquiring the American telecom software company surfaced on Sunday, with the deal estimated to be valued at $1.71 billion based on its outstanding 31 million shares. (NASDAQ:BSFT) for $1.9 billion or $55 per share.

According to the sources if deal negotiations are successfully completed, Cisco will announce the agreement of buying BroadSoft as early as Monday. The market day ended with the two companies enjoying a rise in their shares, with Broadsoft enjoying a 1.5% boost before the bell. It also heralds the company's move from being a purely networking company to one that focuses on software and services delivered via the cloud.

Broadsoft offers cloud-based communication solution that enable mobile, fixed-lines and other communication service providers to offer unified communications over network systems. Founded in 1998, BroadSoft specializes in IP-based communications. its customers include 25 of the world's top 30 telecommunications service providers.

The acquisition was expected to close during the first quarter of 2018.

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Another legacy technology firms have been looking in high-growth areas like security, cloud computing and the Internet of things.

"We believe that our combined offers, from Cisco's collaboration technology for enterprises to BroadSoft's suite for small and medium businesses delivered through Service Providers will give customers more choice and flexibility". According to Robbins, businesses have to think about how they interact with their customers when dealing with digital strategies.

The $55-a-share cash offer announced Monday is a 28 percent premium over BroadSoft's closing price on August 29, a day before Reuters reported that the Gaithersburg, Maryland-based company was working with bankers to pursue a possible sale.

Cisco says that BroadSoft, a U.S. cloud PBX, unified communications, team collaboration, and contact center solutions company will be utilized to offer enterprise clients a wider range of enterprise-based collaboration tools and solutions. The company also makes software for call centers and team collaboration that workers can access online. Cisco reportedly has plans to integrate Perspica's engineering team with the AppDynamics group.