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Cisco Systems buys NDS for $5b

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Monday, March 26th, 2012

As reported in Globes:

Computer communications giant Cisco Systems (Nasdaq: CSCO) today announced that it intends acquiring NDS for $5 billion.

NDS provides secure delivery solutions and other advanced inter-active systems for digital and pay-TV.

Headquartered in Staines near London, the company’s R&D center is in Har Hotzvim, Jerusalem. NDS has 5,000 employees worldwide including more than 1,300 in Israel.

Founded in 1988 in Jerusalem and based on technology developed at the Weizmann Institute of Science, the company was acquired in 1992 by News Corp. (Nasdaq: NWSA), controlled by Rupert Murdoch, which remained the largest shareholder until 2009. Also in 2009, the company was delisted from Nasdaq. Today, NDC is owned by Permira Advisors LLC (51%) and News Corp. (49%).

Cisco senior VP and general manager network management technology group Jesper Andersen, who will be responsible for NDC’s activities, said, “Cisco has an amazing history of activities in Israel, and we see the acquisition as an opportunity to reach the talent that is in Israel. We have no plans to make changes here.”

In its announcement Cisco said, “The acquisition of NDS will complement and accelerate the delivery of Videoscape, Cisco’s comprehensive platform that enables service providers and media companies to deliver next-generation entertainment experiences. 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.

Cisco said, “Under the terms of the agreement, Cisco will pay approximately $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.”

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

NDS executive chairman Dr. Abe Peled said, “Cisco and NDS are helping drive the transition that will enable service providers and media companies to offer new revenue-generating video experiences. NDS’s open software video platform and services are highly complementary to Cisco technology, and together we are uniquely positioned to enable service providers to deliver fresh and exciting multi-screen video services to their customers. A key component of NDS’s success has been our open software and services model, working with a wide range of set-top box manufacturers to enable greater choice for our customers; following this acquisition this strategy will continue and expand the choice of hardware solutions available to service providers worldwide.”

Cisco chairman and CEO John Chambers said, “Our strategy has always been driven by customer need and on capturing market transitions. Our acquisition of NDS fits squarely into this strategy, enabling content and service providers to deliver new video solutions that leverage the cloud and drive new monetization opportunities and service differentiation.”

Published by Globes, Israel business news – www.globes-online.com – on March 15, 2012