Cisco confirms NDS purchase plan

UPDATED STORY. Cisco plans to integrate NDS into its Videoscape service platform following confirmation of a $5 billion (€3.83bn) bid for the technology company.

A statement from the San Jose-based firm confirmed the bid had already been approved by the boards of directors of both companies. It is expected to close in the second half of 2012, subject to various regulatory approvals.

Cisco said the acquisition reflected an increased strategic focus on video, one of its five foundational priorities, and its investment in software and services revenue streams and competencies.

Once completed NDS’s global operations, including sites in the United Kingdom, Israel, France, India and China, and approximately 5,000 employees will join the Cisco Service Provider Video Technology Group (SPVTG), under general manager Jesper Andersen.

Dr Abe Peled, NDS Executive Chairman, will be named Senior Vice President and Chief Strategist for Cisco’s Video & Collaboration Group, of which SPVTG is a part. Dr Peled will report directly to Marthin De Beer, senior vice president, Cisco Video and Collaboration Group.

“Our strategy has always been driven by customer need and on capturing market transitions. Our acquisition of NDS fits squarely into this strategy, enabling content and service providers to deliver new video solutions that leverage the cloud and drive new monetisation opportunities and service differentiation,” said John Chambers, chairman and CEO, Cisco.

“A key component of NDS’s success has been our open software and services model, working with a wide range of set-top box manufacturers to enable greater choice for our customers; following this acquisition this strategy will continue and expand the choice of hardware solutions available to service providers worldwide,” added Dr Peled.

Established in 1988, NDS was integrated into News Corp two years later, before being taken private between June 2008 (announced) and February 2009, when Permira became the controlling shareholder with a 51% stake. Only last December, NDS filed with the US Securities and Exchange Commission for an initial public offering that would raise up to $100 million.

NDS has more than 75 pay-TV customers worldwide, both inside and outside the News Corp group of companies. They include Comcast, DirecTV, Foxtel, Kabel Deutschland, Get, Kabel BW, Sky Italia, Sky Deutschland and BSkyB.

Cisco’s open, standards-based Videoscape platform, which runs across the cloud, the network and end-user clients, is a key part of the company’s overall video strategy across video, mobile and social networks.