Cisco brokered a deal for Acacia in 2019 for approximately $2.6 billion to bolster its optical systems portfolio, and Acacia wants out.
Cisco’s planned acquisition of Acacia Communications took a litigious turn this week as the networking giant has gone to court to keep the optical technologies vendor from terminating the purchase.
Cisco filed for a temporary restraining order in Delaware Chancery Court Jan. 8 to prevent Acacia from terminating its acquisition agreement with the company. The move followed an Acacia statement issued earlier on Jan. 8 that stated the company “has elected to terminate its merger agreement with Cisco Systems, Inc., effective immediately.”
Acacia said the proposed merger was conditioned on the satisfaction or waiver of customary closing conditions, including obtaining necessary regulatory approvals within the timeframe contemplated by the merger agreement. One of those was the approval of China’s State Administration for Market Regulation (SAMR), and Acacia said that hasn’t been obtained within the originally agreed time frame.
For its part Cisco says it has it has met all conditions for closing the deal.
“Cisco is also seeking a court mandate that the agreement may not be terminated until the court resolves these matters, and an order from the Court requiring Acacia to close the transaction. On January 7, 2021, Cisco was notified by SAMR that the agency has determined that Cisco’s submission is ‘sufficient to address the relevant competition concerns.’”
Looking to augment its optical systems portfolio, Cisco brokered a deal for Acacia in 2019 for approximately $2.6 billion. Acacia develops, manufactures and sells high-speed coherent optical interconnect products that are designed to transform networks linking data centers, cloud and service providers.
Cisco stated at the time: “The acquisition of Acacia will allow us to build on the strength of our switching, routing and optical networking portfolio to address our customers’ most demanding requirements.”
For Cisco, one of the key drivers for making this deal was Acacia’s coherent optical technology, which lets networking gear send optical signals over long distances. Acacia uses silicon photonics as the platform for integration of multiple photonic functions for coherent optics, Gartner wrote in a blog about the acquisition. “Leveraging the advances in silicon photonics, each new generation of coherent optics products has enabled higher data transmission rates, lower power and higher performance than the one before,” Gartner stated.
This article originally appeared on NetworkWorld.