Acacia Communications ()ACIA) – Get Report Shares rose on Thursday after the optical component maker said it agreed to a new $ 4.5 billion merger with Cisco Systems ()CSCO) – Get Report Following disagreements involving regulatory approval from China.
Cisco will pay $ 115 per share for Acacia, the company said, aiming to end several months of conflict over the 2019 deal to give Cisco a clear path into spending related to the 5G network rollout. Regulators in the US, Germany and Austria had approved the proposed takeover, but Acacia terminated the original deal due to a lag in obtaining approval from China before the January 8 deadline.
Acacia’s CEO Raj Shanmugraj said, “We maintain our conviction in the strategic benefits of joining the Cisco family and believe that it will be able to better support our existing customers, while increasing the footprint of new customers Can reach. “We are happy to reach this agreement with Cisco and are excited to move forward with this combination, which we believe will transform the optical industry, while providing great opportunities for Acacia employees to continue their innovation. ”
Acacia shares were marked 32.6% higher in afternoon trading after an agreement to change hands to $ 114.64 on Thursday afternoon. Meanwhile, Cisco shares rose 0.33% to $ 45.52.
CEO Chuck Robbins said, “I am delighted that Cisco and Acacia have decided to come together in this mutual deal.” “We look forward to welcoming the Raj and Acacia team to Cisco to offer our customers world-class coherent optical solutions for the power of the Internet for the future.”