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Cisco buys optical company for $271 million

Cisco said it intends to acquire privately held Lightwire, a developer of optical interconnect technology for high-speed networking applications, for $271 million.

Lightwire brings CMOS photonics silicon expertise to Cisco. The company specialises in integrating multiple high-speed active and passive optical functions onto a silicon chip. The smaller-size, lower-power consumption and scalability of Lightwire’s CMOS-based technology enables switches, routers and optical transport systems to have higher-density optical connectivity at a lower cost, Cisco said.

Cisco said Lightwire complements its 2010 acquisition of CoreOptics, a designer of coherent digital signal-processors and application-specific integrated circuits for optical networking. Lightwire is focused on the transition from 40G to 100G, while CoreOptics technology is intended for advanced modulation formats to enable efficient transmission of large amounts of data at 100Gbps over existing fibre optics.

Both technologies will be used in modules for Cisco’s core and edge routers for service providers, and data centre switches.

Cisco expects to close the acquisition in its current third quarter of fiscal 2012, which ends in April. Lightwire employees will be integrated into Cisco’s Transceiver Modules Group Business Unit and Supply Chain Operations Group.

Cisco’s offer for the company is in cash and retention-based incentives in exchange for all Lightwire shares.

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