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Will Cisco Beat Analyst Estimates in Fiscal 1Q18?

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Part 4
Will Cisco Beat Analyst Estimates in Fiscal 1Q18? PART 4 OF 11

How the BroadSoft Acquisition Could Benefit Cisco

BroadSoft acquisition valued at $1.9 billion

Last month, Cisco Systems (CSCO) announced that it had signed an agreement to acquire BroadSoft. According to the deal, Cisco will pay $55 per share in cash for each share of BroadSoft (BSFT), valuing the acquisition at $1.9 billion in cash. The acquisition has been approved by the companies’ boards of directors. BroadSoft is currently trading at $54.85.

According to Cisco Senior Vice President Rowan Trollope, “Together, Cisco and BroadSoft will deliver a robust suite of collaboration capabilities across every market segment. We believe that our combined offers, from Cisco’s collaboration technology for enterprises to BroadSoft’s suite for small and medium businesses delivered through Service Providers will give customers more choice and flexibility.”

How the BroadSoft Acquisition Could Benefit Cisco

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Collaboration should help serve enterprises

BroadSoft’s management believes that merging with Cisco will allow it to deliver best-in-class collaboration tools and services. BroadSoft now offers products and services that cater to the needs of small and medium businesses and are sold through service providers. According to BroadSoft, its product offerings are complementary to Cisco’s on-premise and enterprise-centric HCS (hosted collaboration solution) offerings.

Businesses worldwide are now looking at collaboration solutions that have features such as voice, which can be deployed on-premise or in the cloud. BroadSoft’s open-interface cloud-based solution coupled with Cisco’s collaboration portfolio is expected to offer “best-of-breed” solutions, catering to businesses of all sizes.

Notably, Cisco has been depending on acquisitions for the past few years to drive revenue growth. This deal with BroadSoft is Cisco’s 200th acquisition.

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