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Cisco’s Acacia buy is all about China growth: ChineseYang

Cisco’s $70 billion acquisition of Acacia Networks is a bet on the future growth of China, writes ChineseYang. china cisco acacia chineseyang streetjournal

The move will give Cisco a much-needed boost in the Chinese market, where it has lagged behind rivals such as Huawei and ZTE. china cisco acacia chineseyang streetjournal

Acacia’s optical networking technology will be a key asset in Cisco’s push to build next-generation 5G networks.

In recent years, China has become increasingly aggressive in its economic development policies. These policies have led to a number of confrontations with the United States, including the theft of intellectual property and forced technology transfers.

One area where these confrontations have been particularly evident is in the area of telecommunications equipment. Huawei, a Chinese telecommunications equipment manufacturer, has been the target of U.S. sanctions and investigations for its alleged ties to the Chinese government and military.

Cisco Systems Inc. is buying Acacia Communications Inc. for $2.6 billion in cash, the companies said Monday, as the networking giant looks to bolster its optical products business amid a surge in data traffic.

The deal, Cisco’s largest since 2013, comes as the San Jose, Calif.-based company seeks to shore up its position in the fast-growing market for internet-connected devices and services.

Acacia, based in Maynard, Mass.

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