Cisco’s protracted and contentious acquisition of Acacia is back on track after the networking giant substantially increased its offer price for the optical supplier. In an announcement Thursday, Cisco said it has reached an agreement to acquire Acacia for $115 per share, or approximately $4.5 billion in cash.
Cisco initially offered to acquire Acacia for $70 a share, or $2.6 billion, back in July 2019.
Acacia is a component supplier and maker of high-speed optical interconnect technology for networking systems. Cisco said at the time deal was first announced that the purchase would benefit its existing enterprise network portfolio.
Just last week, however, Acacia announced that it had elected to terminate its merger agreement with Cisco after the company had failed to meet a set of closing conditions such as “obtaining necessary regulatory approvals within the timeframe contemplated by the merger agreement.”
Cisco notified Acacia that it intended to dispute the termination, and wound up taking its case to the US Delaware Court of Chancery to launch an investigation into whether the company had met the conditions set to close the merger. Cisco also asked the court to issue an order that would prevent Acacia from terminating the deal before a legal resolution of the matter.
Acacia held firm and filed its defense with the court alongside a countersuit, seeking confirmation that the merger agreement was justifiably terminated.
Flash forward less than a week, and it now appears that the legal drama has been settled. In a prepared statement, Acacia CEO Raj Shanmugaraj said he was pleased that an agreement was reached between the two companies.
“We maintain our strong conviction in the strategic benefits of joining the Cisco family and believe it will enable us to better support our existing customers, while reaching an expanded footprint of new customers globally,” said Shanmugaraj. “We are pleased to have reached this agreement with Cisco and are excited to move forward with the combination which we believe will transform the optical industry, while providing great opportunities for Acacia employees to continue their innovation.”
Shanmugaraj and all Acacia employees will join Cisco’s Optics business when the deal closes.