Cisco acquires Airespace for $450 million

Cisco Systems today announced its acquisition of wireless local area networking systems provider Airespace. Cisco will pay approximately $450 million in stock and assumed options for the privately held company, with the deal expected to close in the third quarter of Cisco’s fiscal year 2005, which ends Apr. 30.

By landing Airespace, Cisco significantly expands its WLAN solutions portfolio: Airespace’s product suite includes WLAN controllers, access points, management and location software, and security tools. In September 2004, Airespace announced a partnership with IBM—one of Cisco’s biggest customers—to offer Wi-Fi systems to enterprise customers.

The acquisition is Cisco’s largest since March 2003, when it paid $500 million in stock for home networking gear maker Linksys. In December 2004, Cisco also landed network security provider Protego Networks for $65 million.

Upon completion of the deal, Airespace will join Cisco's Data Center, Switching and Wireless Technology Group.

Airespace was founded in July 2001 and has approximately 175 employees, all of whom are expected to join Cisco.