Cisco Systems Inc. (Nasdaq: CSCO) bulked up its wireless business Thursday by acquiring privately held ExiO Communications in a $155 million stock deal.
Shares of the network equipment giant slipped slightly at the opening bell, down 0.13 to 51.
According to Cisco, the purchase of ExiO, a leading developer of wireless technologies for corporate networks based on Code Division Multiple Access (CDMA) technologies, has both short and long term benefits.
In the near term, the company said ExiO's existing wireless technology would add mobility to Cisco's existing voice-over-IP (Internet Protocol) services. Over the long run, the acquisition will move along Cisco's development of a third generation (3G) network, supporting multiple wireless standards, including GSM and CDMA.
Under the deal, Cisco will issue $155 million of its common stock in exchange for all outstanding shares and options of ExiO. Cisco will take a a one-time charge of about 1 cent per share for purchased in-process research and development expenses.
The deal is expected to be completed in Cisco's third quarter.