Cisco To Acquire Video Conference Specialist Tandberg

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The networking giant has made an offer of $3bn (£1.9bn) for its Norwegian rival in the market for video calls

Cisco has announced that it has made a $3bn offer for video conferencing specialist Tandberg which has been accepted unanimously by the Norwegian company’s board of directors and recommended to shareholders.

In a statement released on Thursday morning, Cisco said it had made a cash offer for the video communications company which is based in Oslo which is 11 percent over Tandberg’s closing stock price on Wednesday. The deal is expected to close early next year subject to approval by US and European regulators.

“Cisco and Tandberg have remarkably similar cultures and a shared vision to change the way the world works through collaboration and video communications technologies,” said Cisco chairman and chief executive officer John Chambers. “Collaboration is a $34 billion market and is growing rapidly—enabled by networked Web 2.0 technologies. This acquisition showcases Cisco’s financial strength and ability to quickly capture key market transitions for growth.”

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The move could provide a boost to the popularity of Cisco and Tandberg’s high-end video conferencing suites which can run to hundreds of thousands of pounds. The acquisition will see Tandberg’s video call equipment integrate more effectively with Cisco’s systems creating a bigger pool of users for both companies.

“This will enable intercompany and multi-vendor interoperability and ease of use across the full product portfolio – from desktop to immersive, multi-screen TelePresence. This interoperability will benefit Cisco’s customers, but also competitors and partners by accelerating customer interest in video collaboration globally,” the companies said in a statement.

The two companies do have overlapping product sets however but Cisco has not commented on the specific future of all Tandberg’s product lines and staff. But the networking giant has said that it will continue to invest in Tandberg’s Norwegian operations and also claimed that: “Tandberg’s 1,500 employees globally, with innovation centers in Norway and the United Kingdom, will be extremely important as Cisco’s team continues to drive video innovation and growth.”

Also commenting on the deal, Tandberg chief executive officer Fredrik Halvorsen said that two companies have a shared view on communication and collaboration. “This transaction is a vote of confidence, not just in Tandberg but in our technology and our people. The combination of world-class technologies, Cisco’s global scale, and exceptional people from both organisations will enable us to accelerate innovation and market adoption.”

True to form, the companies will be discussing the deal via video conference today but are also choosing to meet press and analysts in a face to face meeting Oslo.

The UN Climate Change Conference in Copenhagen this December will use Cisco video-conferencing to cut down on the amount of travel delegates have to do in the run up to the event, according to the organisers.

Earlier this month, technology giant Hewlett-Packard announced its high-definition videoconferencing software SkyRoom, aimed at providing small and midsize businesses with live, real-time collaboration for face-to-face meetings with no subscription fees.