The Chinese government has approved the Cisco Systems Inc (CSCO) deal to purchase Acacia Communications Inc (ACIA). An earlier agreement almost failed, but now the two industry leaders are seeking to merge. This would result in the first-ever all-in-one communication equipment manufacturer.
Chinese authorities have authorized the merger of Cisco and Acacia Communications Inc (ACIA). Cisco is delighted with this news as it continues to work hard to close the deal. For the deal to accomplish, Cisco increased its offer this month despite a ban imposed by Chinese regulators on Acacia to pull out of the deal. The company has now resolved the problem.
Cisco Systems Inc (CSCO) has been trying to acquire Acacia since mid-2019 when it first announced its intention to gain a 5G technology company. Acacia shares rose dramatically during this period, the offer grew to $115 per share, and it pegged the ultimate deal value at $4.5 billion.
Acacia’s largest customer at the moment is Cisco Systems Inc (CSCO). Therefore, Cisco cuts its costs and improve profitability, besides being able to use Acacia’s technology. Besides, Cisco must reduce its reliance on government contracts and commercial orders significantly.