It seems that Broadcom has no need for the Ruckus Wireless and ICX Switch business that it recently acquired along with Brocade Communications Systems. Just a month after the Brocade Communications Systems acquisition closes, Broadcom is already selling the business.
The Ruckus Wireless and ICX Switch business is part of Brocade Communications Systems that Broadcom recently acquired for $5.9 billion, according to a report by Channel Partners Online. The decision to sell the Ruckus Wireless and ICX Switch business is part of a bigger plan to move away from the sector and focus on its Fibre Channel SAN business.
Arris, the company that is willing to pay $800 million for the Ruckus Wireless and ICX Switch business of Brocade Communications System, is planning to further expand in the converged wired and wireless networking technologies. The assets will help it grow and reach new customer base, including those that own public venues and enterprises.
The Register reported that offloading the Wireless and ICX Switch business was unexpected especially since Broadcom has recently reported good results from its wireless business. The sale may signal a change in strategy for the company.
Arris will create a new business unit that will include the Ruckus Wireless and ICX Switch business that it plans to buy from Broadcom. Once the deal closes, Ruckus COO Dan Rabinovitsj will lead the business unit, taking responsibility for the growth and expansion of Arris' wireless business.
The transaction will open up opportunities for Arris as it enters the enterprise and service provider markets. The expansion in customer base and business is expected to boost its financial results.
Aside from the $800 million in cash, Broadcom will receive unvested employee stock awards from the transaction. The acquisition is expected to close in the quarter ending July 31.
Jobs & Hire previously reported that Verizon is buying Yahoo's Internet assets for a lower price than originally announced.