Cisco has announced it will absorb mobile experts Starent, in a deal worth $2.9bn which prepares Cisco for the Long Term Evolution of mobile telecoms.
Cisco will pay $36 cash for each share in Starent, which combines with some outstanding equity to value the deal at $2.9bn for the Massachusetts-based company that was set up less than ten years ago but these days employs about 1,000 people, mostly at its development centre in Bangalore.
Those developers create routing and management systems to carry IP packets over cellular networks, which are then integrated into all the popular wireless technologies as well as being ideally suited for LTE - the next generation of wireless that's much more IP-based.
Those systems have already been deployed at more than 100 operators in 45 countries, including the LTE-capable system sold by Motorola amongst others.
The deal has already been approved by the boards of both companies, so depending on the usual regulatory process should complete early next year. But even after acquisition Starent will remain a separate operation, becoming Cisco's Mobile Internet Technology Group headed up by Sarent's founder Ashraf Dahod. ®