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Networking and storage supplier Brocade has acquired wireless networking specialist Ruckus Wireless in a cash and stock deal valued at around $1.2bn (£839m) as it tried to build out its business around the internet of things (IoT) and future 5G mobile networks.
Brocade said the integration of Wi-Fi and the use of shared access – or lightly licensed spectrum – would be vital to meet new demands around coverage, capacity and consistency that will accompany the growth of the IoT, smart city projects, the convergence of Wi-Fi and long-term evolution (LTE) and, ultimately, 5G networks.
“This strategic combination will position us to expand our addressable market and technology leadership with Ruckus’ fast-growing wireless LAN products, and supports our vision to deliver market-leading new IP solutions that enable the network to become a platform for innovation,” said Brocade CEO Lloyd Carney.
“History shows that focused, pure-play companies often innovate faster, are more agile, and deliver better value to their customers. With the rapidly evolving requirements of the digital transformation era, we are positioning ourselves to lead where technology is headed.
“We believe that combining our portfolios will provide significant benefits to our customers and will enable us to accelerate our growth and value creation.”
Brocade said the combined company, post-closure, would be the market leader in service provider wireless and the third-placed supplier of enterprise wireless product in the US and EMEA.
The acquisition will plug a hole in Brocade’s portfolio, enabling it to allow customers in the process of digitising their businesses to deploy more agile network architectures, ranging from deep within the datacentre to the wireless edge. It said large enterprises, public sector services and the hospitality industry could benefit.
“We operate in adjacent segments of the larger networking market with a number of common customers for our complementary products, and have a successful track record of working together,” said Ruckus CEO Selina Lo.
If the deal is closed according to plan, Ruckus will be led by Lo as a business unit within the wider Brocade organisation. Brocade’s latest acquisition comes a week after it bought StackStorm, a developer of open-source datacentre management software.