Cisco/Acacia deal finally receives Chinese government approval
China’s State Administration for Market Regulation (SAMR) has finally granted approval of Cisco’s (NASDAQ:CSCO) purchase of Acacia Communications (NASDAQ:ACIA), approximately 18 months after the two companies first agreed to the deal in July 2019 (see “Cisco to buy Acacia Communications for optical transceiver, components play”). The approval was the last the deal required, and the purchase should be closed in the current calendar quarter as envisioned by the two companies’ newly restruck accord (see “Cisco, Acacia Communications renegotiate merger at higher price”).
SAMR approved the deal on condition that the merged company continue to honor existing contracts in China and otherwise continue to do business in the country. Cisco has stated its intentions to continue to offer Acacia products on the merchant market, so these requirements should not prove a burden.
The draw-out approval process came against a backdrop of tensions between China and the U.S. and extended the closing of the deal well past its expected conclusion (see "Cisco, Acacia Communications optimistic about merger approval from China"). The delay in Chinese approval proved expensive for Cisco, in that Acacia management attempted to back out of the deal January 8 of this year (see “Acacia Communications says Cisco merger is off; Cisco disagrees”). Cisco received a temporary restraining order against the deal’s demise while renegotiating terms with Acacia management. The new purchase agreement, which saw the sale price increase from $2.6 billion to $4.5 billion, was announced January 14.
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Stephen Hardy | Editorial Director and Associate Publisher, Lightwave
Stephen Hardy is editorial director and associate publisher of Lightwave and Broadband Technology Report, part of the Lighting & Technology Group at Endeavor Business Media. Stephen is responsible for establishing and executing editorial strategy across the both brands’ websites, email newsletters, events, and other information products. He has covered the fiber-optics space for more than 20 years, and communications and technology for more than 35 years. During his tenure, Lightwave has received awards from Folio: and the American Society of Business Press Editors (ASBPE) for editorial excellence. Prior to joining Lightwave in 1997, Stephen worked for Telecommunications magazine and the Journal of Electronic Defense.
Stephen has moderated panels at numerous events, including the Optica Executive Forum, ECOC, and SCTE Cable-Tec Expo. He also is program director for the Lightwave Innovation Reviews and the Diamond Technology Reviews.
He has written numerous articles in all aspects of optical communications and fiber-optic networks, including fiber to the home (FTTH), PON, optical components, DWDM, fiber cables, packet optical transport, optical transceivers, lasers, fiber optic testing, and more.
You can connect with Stephen on LinkedIn as well as Twitter.