Cisco Systems, Inc. (NASDAQ: CSCO) and Acacia Communications, Inc. (NASDAQ: ACIA) say they remain “actively engaged” with the State Administration for Market Regulation of the People's Republic of China (SAMR) in pursuit of approval of their merger plans (see "Cisco to buy Acacia Communications for optical transceiver, components play"). SAMR approval is a condition of Cisco’s purchase of Acacia. The two companies say they expect to receive such clearance.
SAMR approval is required for the combined company to continue to do business in China. The approval process often can take longer than expected; the closing of II-VI’s purchase of Finisar was delayed by the time that deal took to receive SAMR’s blessings (see “II-VI to refile Finisar purchase approval request with Chinese authority”). In the II-VI/Finisar case, the initial application for approval expired after a year, which led to a refiling. Cisco announced the merger agreement July 9, 2019; it is not known when Cisco and Acacia applied for SAMR approval and whether their application expires after a year as well. II-VI and Finisar received SAMR approval for their deal about a month after refiling (see "China approves II-VI/Finisar deal, closing date set").
Cisco and Acacia say their merger agreement calls for the purchase to close no later than the third business day following the satisfaction or waiver of the various closing conditions; Cisco originally said it expected the deal to close in the second half of its 2020 fiscal year, which ends this Saturday, July 25. However, the agreement also includes a provision that will enable the companies to extend the close deadline in pursuit of regulatory approvals. Cisco and Acacia say the SAMR approval is the last they need to receive, with the United States, Germany, and Austria already signing off.
Meanwhile, representatives from the two companies reiterated their enthusiasm for the tie up. "We are looking forward to Acacia joining Cisco and are excited to partner with their world-class team to build on the great success in their core markets," said Bill Gartner, Cisco senior vice president and general manager for the Optical Systems and Optics Group. "We are fully committed to and strongly believe in the merits of this pending acquisition. Together, we will support and strengthen their existing customer base around the world, and look forward to further expansion, underpinned by Acacia's current portfolio and future product roadmaps."
"We'd like to thank our customers for their support of the transaction," added Raj Shanmugaraj, president and CEO of Acacia. "We are excited about the acquisition, including the growth opportunities it affords our customers and are looking forward to closing."
For related articles, visit the Business Topic Center.
For more information on optical modules and suppliers, visit the Lightwave Buyer’s Guide.
To stay abreast of optical communications technology, subscribe to Lightwave’s Enabling Technologies Newsletter.