Cisco Systems Inc. (NASDAQ: CSCO) has continued to make acquisitions, but that big acquisition that institutional investors are pressing for remains elusive. The networking giant has been making acquisitions of private companies with future technology applications instead. News broke on Friday that Cisco is acquiring privately held Acano for $700 million.
Acano is a conferencing software company, which means that Cisco wants to grow that old telepresence effort that has become its collaboration operations. What makes this acquisition different from many other deals that Cisco has pursued is that Acano is based in London.
This fits in with Cisco’s effort to grow its collaboration efforts. Acano’s hardware and software solutions are made up of gateways and video with audio bridging technology that will allow users to connect their video capabilities and systems across both cloud and hybrid environments. The release said:
This acquisition will accelerate Cisco’s collaboration strategy to deliver video everywhere, providing the best collaboration experience across every endpoint, every screen, every workspace, and to every user.
Cisco’s acquisition announcement noted that Acano should accelerate its collaboration momentum, while bringing new capabilities to the market faster. The aim is to deliver open and interoperable solutions, whether in the cloud or via a hybrid model.
Cisco still maintains that not even 10% of conference rooms are connected with video yet. Cisco has been trying to change that, and this acquisition is expected to compliment that growth, which was roughly 17% growth in the latest quarter versus a year earlier. Collaboration efforts were actually 11% of Cisco’s revenue in the last fiscal year.
A $700 million acquisition is not enough to move the needle for investors at this time. After all, Cisco’s market cap is $140 billion. Shares were up fractionally on Friday to $27.56. Its 52-week range is $23.03 to $30.31, and the consensus analyst price target is $31.14.
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