Cisco (CSCO) is acquiring BroadSoft (BSFT) for $55/share in cash or $1.9 billion, net of cash.
Cisco is paying just a 2% premium to Friday's close as a deal had been anticipated. Shares of BSFT were trading near an all-time high, up ~25% since Reuters reported Broadsoft was considering a sale in late August.
Broadsoft is a in the unified communications as a service (UCaaS) sector -- essentially cloud communications software. Peers include RingCentral (RNG), 8x8 (EGHT), Vonage (VG) and Ooma (OOMA). Many have expected consolidation in the UCaaS sector. In early August, Bloomberg reported RingCentral (RNG) had received takeover interest.
This morning, Cisco said more and more businesses expect fully featured voice and contact center solutions with the ability to deploy them on-premises or in the cloud. By combining BroadSoft's open interface and standards-based cloud voice and contact center solutions delivered via Service Provider partners, with Cisco's leading meetings, hardware and services portfolio, the combined company will offer best-of-breed solutions for businesses of all sizes and deliver a full suite of collaboration capabilities to power the future of work.
The acquisition of BroadSoft reinforces Cisco's commitment to Unified Communications and enhances its ability to address the millions of aging TDM lines poised to transition to IP technology and cloud native solutions over the coming years.
"Cisco recently marked a significant milestone with our 200th acquisition. Acquisitions continue to be a core part of our innovation strategy and over the past two years have helped Cisco accelerate or enter areas such as IoT, application intelligence, AI, hyperconvergence and SD-WAN," said Rob Salvagno, vice president of Cisco Corporate Development. "With the addition of BroadSoft, we expect to accelerate the pace of innovation across our entire collaboration portfolio."