Cisco Systems (CSCO)

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Cisco Announces $320 Million Deal for Israeli Chip Maker

Source: Dow Jones News
By Don Clark and Orr Hirschauge
Cisco Systems Inc. said it had agreed to buy Leaba Semiconductor for $320 million, an Israeli company that designs networking chips.

The deal extends a recent spate of mid-sized deals by the networking giant, which has historically used acquisitions to build some of its biggest businesses. On Tuesday, Cisco announced a $260 million deal to buy CliQr Technologies, a startup that helps companies manage software internally or on external cloud services.

Cisco, based in San Jose, Calif., relies on a combination of internally developed chips and those purchased from external vendors for its routing and switching gear.

Leaba, a closely held company based near Tel Aviv, hadn't disclosed details of its product plans. But Cisco said it expects the startup's chip technology to contribute to advances in its hardware.

"By combining Leaba's semiconductor expertise with the Cisco engineering team, we will accelerate our plans for Cisco's next generation product portfolio and bring new capabilities to the market faster," wrote Rob Salvagno, Cisco's vice president of corporate development, in a blog post.

Leaba's founders previously started Dune Networks, a communications-chip designer bought by Broadcom Corp. in 2009 for $178 million. Their latest company was backed by several venture funds, including Bessemer Venture Partners, and Israel-based Pitango Venture Capital.

The Leaba team will report into Cisco's Core Hardware Group, led by Senior Vice President Ravi Cherukuri, Mr. Salvagno said.

Write to Don Clark at [e-mail] and Orr Hirschauge at [e-mail]


(END) Dow Jones Newswires

March 02, 2016 15:42 ET (20:42 GMT)

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