Cisco Fills Triple-Play Slot

The network giant pays $97M for Sheer Networks in backyard acquisition.

 By Colin C. Haley
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Like a pro sports team drafting college prospects, Cisco Systems continues to acquire small companies to strengthen its lineup.

The San Jose, Calif., network equipment giant this morning said it will pay $97 million in cash and options for Sheer Networks. The price tag could jump another $25 million if Sheer meets product milestones after the close.

Sheer's platform helps telecom carriers and large corporations deploy the triple-play services of voice, video and data) It also simplifies monitoring and maintenance of complex networks.

"We are continuously investing in our business to meet our customers' needs, and the Sheer Networks acquisition will strengthen our ability to provide innovative and effective network management solutions," Cliff Meltzer, senior vice president for Cisco's Network Management Technology Group, said in a statement.

When the deal closes in the fall, Sheer's 100 employees in San Jose, Calif., and Petach Tikva, Israel, will be folded into Meltzer's group.

Cisco will likely also gain relationships with systems integrators and resellers that augmented Sheer's own direct sales force.

For Sheer, becoming part of Cisco means "our technology will become available to a far broader audience and new market segments," Klod Ghez, Sheer's CEO, said in a note to customers and employees posted on the company's Web site today.

Cisco has been buying smaller companies than it did during the Internet boom of the late 1990s. Its purchases are aimed at adding technologies, intellectual property and speeding time-to-market for products.

On Friday, the company announced a $61 million cash and stock bid for Denmark-based KiSS Technology. KiSS' platform, which is used in DVD players and recorders, provides access to content on the Internet or other devices in a home network. It will become part of Cisco's Linksys division.

Cisco has also been snapping up storage, security and Voice over IP firms.

This article was originally published on Jul 26, 2005
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