Cisco acquires IPmobile for US$425 Million

Networking titan Cisco Systems Inc. will acquire wireless systems software company IPmobile Inc. for US$425 million in stock, the companies announced Tuesday.

Privately held IPmobile will increase Cisco’s tally to 16 networking companies bought this year alone, continuing a brisk pace of acquisitions. Cisco’s purchase points toward expansion of their wireless networking efforts, complementing the acquisition of wireless LAN vendor Aironet Wireless Communications Inc. for $799 million last November and of wireless telephony company JetCell Inc. in March for $200 million.

IPmobile develops IP radio access networks (IP-RAN) that connect wireless transmission base stations to the Internet. RANs manage and control the radio networks between the user devices like Internet-capable cell phones and the base stations, and provide access to data and voice services. IPmobile works with third-generation wireless technology.

Cisco said it expects a one-time charge of approximately three cents per share after taxes for purchased in-process research and development expenses. Both companies’ boards of directors have approved the deal, but it remains subject to various closing conditions, and should be complete by Cisco’s first fiscal quarter of 2001, the company said.

Cisco Systems, in San Jose, Calif. can be reached at http://www.cisco.com. IPmobile, in Richardson, Tex., can be reached at http://www.ipmobile.com/.

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