Shares of Acacia Communications (ACIA) - Get Acacia Communications, Inc. Report soared 35.1% to $64.92 Tuesday after Cisco (CSCO) - Get Cisco Systems, Inc. Report agreed to acquire the optical equipment maker for about $2.6 billion, or $70 a share in cash, the companies said.
The transaction is expected to close during the second half of Cisco's 2020 fiscal year.
Upon completion, Acacia employees will join Cisco's optical systems and optics business within the networking and security business under David Goeckeler, executive vice president and general manager of Cisco's networking and security business.
Acacia's technology will enrich Cisco's optical systems portfolio, Cisco said in a statement, and allow the growing number of customers transitioning from chassis-based systems to pluggable technology to simplify operations and reduce network complexities.
"By innovating across software, silicon and optics, Cisco is reinventing every domain of the network with our intent-based architectures," Goeckeler said in a statement. "With the explosion of bandwidth in the multi-cloud era, optical interconnect technologies are becoming increasingly strategic. The acquisition of Acaciawill allow us to build on the strength of our switching, routing and optical networking portfolio to address our customers' most demanding requirements."
Shares of Cisco were down by 1% to $55.63.