Belkin to buy Cisco's Linksys

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Belkin on Thursday announced that it is planning to acquire Cisco's (NASDAQ: CSCO) home networking business division, Linksys, including its products, technology, employees, and the Linksys brand.

This follows earlier rumors that the networking giant was looking to sell off Linksys, a primary component of the Cisco division that saw sales fall 35 percent in the last two years. The move is the latest that sees Cisco shedding consumer-centric businesses as it focuses on solutions geared towards business and enterprises.

The acquisition will allow Belkin to increase its overall reach in the home and small business networking market considerably, to an estimated 30 percent of the United States market alone. In addition, the acquisition is expected to strengthen Belkin's presence in the consumer and connected home space. Belkin says it will honor all valid warranties for current and future Linksys devices.

No financial terms were disclosed, though Bloomberg reported earlier that the unit is "likely to fetch much less than the $500 million Cisco paid for it in 2003." The report cited people familiar with the situation who attributed it to the mature consumer segment with low margins that Linksys is in. The deal is expected to close in March.  

For more:
- check out this article at CNET
- check out this article at Belkin

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