View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Hardware
April 5, 2016updated 05 Sep 2016 11:32am

Brocade buys Ruckus Wireless in $1.5 billion deal to bolster wi-fi portfolio and pursue 5G and IoT

News: Merger will create a "new type of pure-play networking company".

By Alexander Sword

Brocade is acquiring Ruckus Wireless in a cash and stock deal to build its enterprise networking offerings.

The deal, worth approximately $1.5 billion in total or $1.2 in net of estimated cash acquired, will add Ruckus’s wireless products, such as its wi-fi service, to Brocade’s portfolio and expand Brocade’s strategic presence in the service provider space.

Brocade expects that the transaction will be accretive to its earnings by Q1 2017.

Ruckus’s current CEO Selina Lo will lead the Ruckus organisation within Brocade and report directly to Brocade CEO Lloyd Carney.
Brocade hopes that the combination will create a "new type of pure-play networking company".

The acquisition is expected to improve cross-selling activities between the customer and partner bases of the two companies.

In addition, it is intended to strengthen the company’s ability to pursue emerging technologies such as 5G mobile, the IoT, smart cities and convergence between LTE and wi-fi.

Lloyd Carney said: "History shows that focused, pure-play companies often innovate faster, are more agile, and deliver better value to their customers."

Content from our partners
How businesses can safeguard themselves on the cyber frontline
How hackers’ tactics are evolving in an increasingly complex landscape
Green for go: Transforming trade in the UK

Carney claimed that the combined company was positioned to lead in the "rapidly evolving requirements of the digital transformation era.

"We believe that combining our portfolios will provide significant benefits to our customers and will enable us to accelerate our growth and value creation," he said.

The acquisition attracted praise from the industry. Shane Buckley, CEO of Ruckus competitor Xirrus, said: "This move by Brocade confirms our view that enterprise infrastructure vendors recognise the value of developing wireless capabilities as their customers migrate to mobile and embrace BYOD."

Buckley said that the acquisition complements Brocade’s efforts to diversify into campus networks, which the acquisition of Foundry started.

"The challenge is that Ruckus has had a rich history in the service provider market – carriers and hospitality MSPs – but is not as well known in the enterprise campus networking space," said Buckley.

Brocade also announced that it would continue its stock repurchase programme, intended to facilitate the repurchase of all the shares issued in conjunction with this acquisition. The aim is to repurchase them within six months of the acquisition closing.

Websites in our network
Select and enter your corporate email address Tech Monitor's research, insight and analysis examines the frontiers of digital transformation to help tech leaders navigate the future. Our Changelog newsletter delivers our best work to your inbox every week.
  • CIO
  • CTO
  • CISO
  • CSO
  • CFO
  • CDO
  • CEO
  • Architect Founder
  • MD
  • Director
  • Manager
  • Other
Visit our privacy policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.
THANK YOU