Cisco To Acquire PipeLinks

Cisco Systems Inc.
Wednesday acquired router maker PipeLinks Inc. for $126 million in
stock in a deal that will move Cisco and its Internet provider customers
further into the voice-over-IP market.


PipeLinks makes a variety of routers that are capable of simultaneously
transporting circuit-based and IP traffic. The deal builds on a
relationship began in 1997 when Cisco took a minority investment in the
company.


Cisco said the acquisition will allow Internet providers to embrace new
technologies, such as Internet telephony, while keeping their existing
sychronous optical network and synchronous digital hierarchy equipment.


“This acquisition is intended to enable Cisco’s service provider
customers…to offer integrated network services for data and voice at the
edge of the network,” the company said.


“This technology is expected to allow service providers to offer new
services, such as managed Internet access and native LAN services over
their existing infrastructure. In addition, service providers will be able
to continue to offer existing services like leased line and voice transport
more effectively.”


To finance the acquisition, Cisco plans to take a one-time charge of
between 3 and 6 cents in its fiscal second quarter.


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