Cisco to acquire BroadSoft for $1.9bn to foster the future of work

24 Oct 2017

Cisco logo on a building in Switzerland. Image: Denis Linine/Shutterstock

This will be Cisco’s 201st acquisition and one that will cement its leadership position in unified communications.

Silicon Valley internet giant Cisco has agreed to pay $1.9bn to acquire business telecoms player BroadSoft.

Cisco has offered BroadSoft $55 a share in cash – a 28pc premium over the company’s closing price on 29 August – and the acquisition is expected to close during the first quarter of 2018.

The move expands Cisco’s presence in the software and cloud business, and capitalises on opportunities in the ever-evolving future-of-work space. It is consistent with Cisco’s strategic pivot away from expensive equipment and hardware to cloud-based software services.

The cloud meets the future workplace

“Together, Cisco and BroadSoft will deliver a robust suite of collaboration capabilities across every market segment,” said Rowan Trollope, senior vice-president and general manager of Cisco’s applications business group.

“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.”

BroadSoft was established in 1998 by former Alcatel vice-president Michael Tessler and Celcore executive Scott Hoffpauir.

“As businesses continue to move toward the cloud in search of simplicity and speed, joining Cisco will allow us to deliver best-in-class collaboration tools and services,” said Tessler.

“BroadSoft’s hosted offerings, sold through the service providers and aimed at small and medium businesses, are highly complementary to Cisco’s on-premises and enterprise-centric HCS offerings. Together, we can inspire teams to create, collaborate and perform in ways never before imagined.”

The BroadSoft deal follows hot on the heels of Cisco’s 200th acquisition, that of analytics firm Perspica for $8.5bn. Earlier this year, Cisco acquired AppDynamics for $3.7bn.

Cisco logo on a building in Switzerland. Image: Denis Linine/Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years