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Cisco to Buy BroadSoft for $1.9B

Cloud calling, contact center company works with Cox, Comcast, Charter 10/23/2017 9:40 AM Eastern

Cisco Systems confirmed Monday that it has inked a deal to acquire BroadSoft, a maker of cloud calling and contact center products, for $1.9 billion in cash.

Under the deal, Cisco plans to buy the Gaithersburg, Md.,-based company for $55 per share, in cash, in exchange for each share of BroadSoft.

Cisco said the deal will bolster its Unified Communications business and help it address “millions of aging TDM lines” that are poised to pivot to IP technology and cloud-native solutions in the years ahead.

The purchase will also give Cisco more exposure to cable operators, such as Cox Communications, Charter Communications, and Comcast, that work with BroadSoft to deliver hosted-voice services to business customers. BroadSoft works with more than 450 telecom carriers in 80 countries, Rob Salvagno, VP of corporate business development at Cisco, noted in this blog post.

RELATED: Cox Business Mobilizes Its Hosted Voice Platform

BroadSoft pulled in Q2 revenues of $88.8 million, up 9% from the year-ago quarter, along with a net loss of $3 million, or 10 cents per share. It’s forecasting Q3 revenues of $84 million to $90 million.

"Together, Cisco and BroadSoft will deliver a robust suite of collaboration capabilities across every market segment," Rowan Trollope, senior vice president and general manager of Cisco's Applications Business Group, said in a statement. "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."

Cisco and BroadSoft expect to close the deal during Q1 of 2018. They intend to continue to operate as separate companies, with BroadSoft employees joining Cisco's Unified Communications Technology Group, led by Vice President and General Manager Tom Puorro, under the Applications Group led by Trollope.

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