Cisco to buy video content distribution company

Cisco Systems Inc. announced this morning it intends to buy NDS Group Ltd., a provider of video software and content security solutions that enable service providers and media companies to deliver video streams.

In a news release the companies said NDS uses the combination of a software platform and services to create differentiated video offerings for service providers that enable subscribers to intuitively view, search and navigate digital content anytime, anywhere and on any device.

Cisco [Nasdaq: CSCO] said the deal will complement and accelerate the delivery of  its Videoscape platform that enables service providers and media companies to deliver entertainment content. It also hopes acquiring NDS will broaden Cisco’s opportunities in the service provider market, expanding its reach into emerging markets, such as China and India, where NDS has an established customer footprint.

Under the terms of the agreement, Cisco will pay approximately US$5 billion, including the assumption of debt and retention-based incentives, to acquire all of the business and operations of NDS. The acquisition has been approved by the boards of directors of both companies.

The acquisition is expected to close during the second half of calendar year 2012, subject to customary closing conditions, including regulatory review in the United States and elsewhere. The net impact to Cisco is expected to be accretive to EPS in the first full year on a non-GAAP basis.

NDS has about 5,000 staffers in the United Kingdom, Israel, France, India and China. When the deal is sealed they will join the Cisco Service Provider Video Technology Group (SPVTG), led by senior vice-president and general manager Jesper Andersen.
Dr. Abe Peled, NDS’ executive chairman, will be named senior vice-president and chief strategist for Cisco’s video and collaboration Group, of which SPVTG is a part. He will report directly to Marthin De Beer, senior VP of the video and collaboration Group.
We’ll have more news on this as the day goes on.

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