Cisco is set to acquire Acacia Communications, a manufacturer of optical interconnect technologies, for approximately $2.6 billion.
The acquisition will enable Cisco, the largest enterprise networking supplier in the world, to expand its optical systems offerings to webscale companies, service providers, and data center operators.
Maynard, Massachusetts based Acacia reported revenue of $105.2 million (+44 percent) with gross margin of 47.4 percent in its first quarter of 2019.
The deal is Cisco’s biggest acquisition for Cisco since its $3.7-billion purchase of business performance monitoring software company AppDynamics in 2017.
Cisco plans to support Acacia’s existing customers and new customers that want industry-leading coherent optics, digital signal processing / photonic integrated circuit modules, and transceivers for use in networking products and data centers.
“The acquisition of Acacia will allow us to build on the strength of our switching, routing and optical networking portfolio to address our customers’ most demanding requirements,” David Goeckeler, executive vice president and general manager of Cisco’s networking and security business.
The acquisition is expected to close during the second half of Cisco’s FY2020. Employees of Acacia will join Cisco’s Optical Systems and Optics business within the networking and security business under David Goeckeler.