Cisco close to acquiring telecommunications software provider BroadSoft: sources

If the deal goes through it will not only be Cisco’s second biggest acquisition this year but will also strengthen its foothold in the telecommunications market as well as diversify its offerings and services.

As per a source familiar with the matter at hand, Cisco Systems Inc, the world’s biggest manufacturer of networking gear is closing in on a deal to acquire BroadSoft Inc, a U.S. telecommunications software company for close to $2 billion.

The deal will allow Cisco to further diversify its offerings and move away from the stagnated market of switches and routers, which are its bread and butter products.

The deal will also provide Cisco a stronger foothold for its sales pitch for selling unified communications software to big telecommunications companies.

As per the source, contingent on successful negotiations, the deal could be announced later on Monday.

The source has preferred the cover of anonymity since details of the discussions on the deal are confidential.

While BroadSoft did not immediately return a request for comment Cisco declined to comment.

If this acquisition goes through, it would mark Cisco’s second major acquisition this year following its $3.7 billion acquisition of AppDynamics Inc, a privately held firm, in March.

On Friday, BroadSoft’s shares had closed at $54.90 giving the company a market capitalization of $1.67 billion.

Gaithersburg, Maryland, based BroadSoft provides software and services that enable mobile, fixed-line and cable service providers to offer unified communications over their internet protocol networks.

As per a research report from Barclays Plc, BroadSoft has recently revamped its business model to sell directly to telecoms.

The move risks alienating telecommunications partners.


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