Cisco moves into TV with $6.9 bln Scientific-Atlanta buy

Cisco Systems Inc. has agreed to buy Scientific-Atlanta, a leading maker of set-top boxes for cable television, in a deal worth some 6.9 billion dollars.

The deal gives Cisco a powerful platform to break into cable television equipment from its dominant position in making the routers and other network equipment that power much of the Internet. It also positions the company to capitalize on the convergence of digital media, in which the set-top boxes could function as residential gateways and the hub of home entertainment systems by communicating with computers, audio devices and a range of appliances.

Under the deal, Cisco will pay 43 dollars per share of Scientific American, the second largest maker of set-top boxes after Motorola. The 6.9 billion price tag also includes cash reserves of 1.6 billion dollars.

Scientific-Atlanta, based in Lawrenceville, Georgia, has 6,500 employees and 1.9 billion dollars in annual revenue. Cisco, centred in Silicon Valley, has 34,000 employees and 24 billion dollars in annual revenue. (dpa)