Cisco Systems acquiring online meeting company WebEx Communications

Cisco Systems acquiring online meeting company WebEx Communications

Networking hardware maker Cisco has said that they are acquiring the online meeting company WebEx Communications.

The deal is worth around $3.2 billion and it would be conducted in a cash only transaction. The company said that it would pay around $57 per share of WebEx.

This comes to around 23 percent premium over WebEx’s closing price of $46.20 Wednesday on NASDAQ. The news helped WebEx at the stock market as its price soared $10.53, or more than 22 percent, to $56.73 in early trading on the stock market.

Cisco further said that the boards of both the companies have approved this deal and they expect to close it by the fourth quarter of fiscal 2007.

Charles H. Giancarlo, Cisco’s chief development officer spoke on this deal: “As collaboration in the workplace becomes increasingly important, companies are looking for rich communications tools to help them work more effectively and efficiently. The combination of Cisco and WebEx will deliver compelling solutions accelerating this next wave of business communications.”

Roger Kay, president of Endpoint Technologies Associates had this to say about Cisco’s latest acquisition: “From Cisco’s point of view, it makes some sense: You’re beefing up Linksys, you’re grabbing a player that can help increase the value of the Linksys franchise, and you’re a grabbing a player that’s already well established in markets you’ve assessed will have high growth rates.”