Cisco's Tandberg Acquisition Gets Regulators' Approval

Cisco has announced that its proposed acquisition of teleconferencing service provider Tandberg has been approved by both the European Commission and the US Department of Justice. The transaction can now move forward and the two companies believe the acquisition will close in no longer than a few weeks. Cisco made its intentions to buy the Norwegian company public a few months ago and has offered $3.4 billion for it.

"We appreciate the thorough and efficient manner in which the Justice Department and the European Commission conducted their review of this transaction, and we are grateful for the leadership and close cooperation between the agencies throughout this process," Marthin De Beer, SVP of Cisco's Emerging Technologies Business Group, said in a statement.

"Cisco has always strongly believed that industry expansion and growth is best fostered through open standards and interoperability, and our commitments to the Commission formalize our approach in this area. Our commitments will promote multi-vendor interoperability and contribute to the ubiquity of video communications, which will benefit customers, competitors and the industry as a whole," he added.

Cisco has had to make several concessions to the European Commission in order to get the approval. The company has to provide an independent monitor to check if those concessions are being met. It has vowed to give up the ownership of the TelePresence Interoperability Protocol (TIP) it developed, as well as that of all the code needed to implement it. Cisco also has to provide access to its own TIP implementations to any interested party, royalty-free.

All of this is required to ensure that the teleconferencing market remains open to competitors and to guarantee interoperability between hardware implementations. Cisco aims to solidify its position in the teleconferencing market, where it offers mostly high-end solutions, with Tandberg products that cater to the other sectors as well. The initial $3-billion offer was rejected by Tandberg shareholders, prompting Cisco to raise its bid to $3.4 billion.