Chinese Regulator Approves Cisco Acquisition of Acacia
By Yifan Wang
A Chinese market regulator on Tuesday approved Cisco Systems
Inc.'s acquisition of Acacia Communications Inc. on the condition
the companies comply with rules aimed at reducing the deal's
possible impact on market competition.
The telecom-equipment companies and the subsequent merged entity
are required to continue fulfilling existing contracts with Chinese
clients and keep relevant commercial terms unchanged, the State
Administration for Market Regulation said Tuesday.
Beijing's top market regulator also requires Cisco and Acacia to
continue supplying certain products to Chinese clients without
discrimination and unreasonable deal terms.
The regulator said that it believes the deal could eliminate or
restrict competition in the optical transmission system industry in
China, and that these conditions could reduce the expected negative
impact on market competition.
The restrictions will remain effective for five years, it
Cisco last week boosted its purchase price for Acacia, after the
latter moved to terminate the deal as the companies awaited Chinese
Cisco will now pay $115 a share to acquire Acacia, a 64%
increase to the original price of $70 a share agreed to in July
2019. The deal values Acacia at about $4.5 billion on a fully
Write to Yifan Wang at firstname.lastname@example.org
(END) Dow Jones Newswires
January 19, 2021 06:50 ET (11:50 GMT)
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