Cisco Systems to Acquire NetSpeed Inc.; Products Expand Digital Subscriber Line Offerings.SAN JOSE San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , Calif.--(BUSINESS WIRE)--March 10, 1998--Cisco Systems, Inc. today announced it has signed a definitive agreement to acquire privately-held NetSpeed Inc. of Austin, Texas. NetSpeed is a market leader in Digital Subscriber Line See DSL. (communications, protocol) Digital Subscriber Line - (DSL, or Digital Subscriber Loop, xDSL - see below) A family of digital telecommunications protocols designed to allow high speed data communication over the existing copper telephone lines between end-users and (DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary ) technology in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . Its networking product suite provides high-speed Internet See broadband. access and data transmission using existing copper phone lines. Under the terms of the acquisition, between 3.7 and 4.0 million shares of Cisco common stock (subject to certain adjustments) will be exchanged for all outstanding shares and options of NetSpeed. Based upon Cisco's March 9 closing price of $61.22, the stock exchanged would have a value of approximately $236 million. In connection with the acquisition, Cisco expects a one-time charge against after-tax earnings of between $.13 and $.18 per share for purchased-in-process research and development expenses in the third quarter of fiscal 1998. The acquisition has been approved by the board of directors of each company and is expected to be completed by April subject to various closing conditions, including, approval under the Hart-Scott Rodino Antitrust Improvements Act. Cisco Expands DSL Product Line; Will Offer Complete End-to-End Solution NetSpeed's product suite adds customer premise equipment, central office products and broadband remote access to Cisco's DSL product portfolio. Its DSL products are deployed in production carrier networks including Cincinnati Bell, Telus and US WEST. NetSpeed's DSL product line for North America complements Cisco's 1997 acquisition of DSL solutions from the Dagaz business of Integrated Network Corp. targeted at international markets. DSL technology offers high-speed information transmission over existing phone lines enabling a new class of high-bandwidth applications like telecommuting telecommuting, an arrangement by which people work at home using a computer and telephone, transmitting work material to a business office by means of a modem and telephone lines; it is also known as telework. , telemedicine, distance learning and downloading graphic-intense web pages. NetSpeed's expertise in DSL technology enables Cisco to offer telephone companies and other service providers an end-to-end DSL solution leveraging their existing infrastructure to accelerate integrated data, voice and video services to the home at affordable service rates. NetSpeed's solutions feature low-cost customer premise modems with a splitterless solution enabling "plug and play" and cost effective service provisioning. "Cisco's acquisition of NetSpeed will enable US WEST to accelerate the deployment of DSL services," said Joe Zell, president of US WEST. "Together with Cisco as a strategic partner in our broadband strategy solution, we are confident the challenges of growing this new market can be met in record time with our combined strengths." NetSpeed is a leader in standards-based DSL technology. Its central office products are carrier class telecommunications equipment supporting the North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. Equipment Building System (NEBS) requirements. NetSpeed was founded in 1996. The approximately 140 employees will continue to work in Austin, Texas. John McHale, NetSpeed president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , and his team will become part of the Network-to-User Business Unit headed by Vice President and General Manager Kevin Kennedy within Cisco's Service Provider line of business. About Cisco Systems Cisco Systems (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CSCO CSCO Cisco Systems Incorporated (stock symbol) CSCO Chief Supply Chain Officer ) is the worldwide leader in networking for the Internet. News and information are available at http://www.cisco.com. -0- Note to Editors: Cisco, Cisco Systems, and the Cisco Systems logo are registered trademarks of Cisco Systems, Inc. in the United States and certain other countries. All other trademarks mentioned in this document are the property of their respective owners. This release may contain forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results. Readers are referred to the documents filed by Cisco with the SEC, specifically the most recent reports on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and 10-Q, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements, including potential fluctuations in quarterly results, dependence on new product development, rapid technological and market change, acquisition strategy, manufacturing risks, risks associated with the Internet infrastructure, volatility of stock price, financial risk management and future growth subject to risks. CONTACTS: Cisco Systems, Inc. Stacey O'Hara, 408/527-9365 (Public Relations public relations, activities and policies used to create public interest in a person, idea, product, institution, or business establishment. By its nature, public relations is devoted to serving particular interests by presenting them to the public in the most ) sohara@cisco.com Mary Thurber, 408/526-8893 (Investor Relations Investor relations The process by which the corporation communicates with its investors. ) mthurber@cisco.com or NetSpeed, Inc. Charlene Rogers, 512/249-3101 (Public Relations) crogers@netspeed.com |
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