Cisco intends to acquire privately held San Francisco-based Pure Digital Technologies Inc. The company created the best-selling Flip Video brand, and is a pioneer in developing consumer-friendly video solutions with mass-market appeal.
"The acquisition of Pure Digital is key to Cisco's strategy to expand our momentum in the media-enabled home and to capture the consumer market transition to visual networking," said Ned Hooper, senior vice president of Cisco's Corporate Development and Consumer Groups. "Pure Digital has revolutionized the way people capture and share video with Flip Video. This acquisition will take Cisco's consumer business to the next level as the company develops new video capabilities and drives the next generation of entertainment and communication experiences."
Pure Digital's Flip Video has sold more than 2 million units and quickly demonstrated market appeal in the United States by making video simple, accessible and fun.
All Flip Video products come equipped with FlipShare software that allows users to easily organize and edit videos and then share them instantly on YouTube, MySpace and other popular sharing Web sites.
After the close of the acquisition, the Pure Digital team will become part of Cisco's Consumer Business Group, which includes Linksys by Cisco home networking, audio and media-storage products.
Cisco will pay approximately US$590 million in stock in exchange for all shares of Pure Digital. In addition, Cisco will provide up to US$15 million in retention-based equity incentives for continuing employees. The acquisition is subject to various standard closing conditions and is expected to close in the fourth quarter of Cisco's fiscal year 2009.