Belkin Plans to Purchase Cisco's Linksys Home Networking Business Unit
January 25, 2013 8:55 AM
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Belkin plans to buy Linksys
Cisco has been looking to ditch its Linksys home networking division since December and
Barclays PLC to help find a buyer. Cisco originally acquired Linksys in 2003 for $500 million to get itself into the consumer networking market.
It looks like Cisco has finally found a buyer with Belkin announcing this week that it intends to acquire the Linksys division. The deal will see Belkin acquiring Linksys products, technology, the Linksys brand, and employees. Belkin says the Linksys main office will be located in Irvine, California.
Cisco/Linksys E4200V2 Dual-Band Wireless Router
“We’re very excited about this announcement,” said Chet Pipkin, CEO of Belkin. “Our two organizations share many core beliefs – we have similar beginnings and share a passion for meeting the real needs of our customers through the strengths of an entrepreneurial culture. Belkin’s ultimate goal is to be the global leader in the connected home and wireless networking space and this acquisition is an important step to realizing that vision.”
Belkin says that it will maintain the Linksys brand and offer support for existing Linksys products as part of the transaction. Belkin will honor all valid warranties for current and future Linksys products. Belkin also says that after the transaction closes it will own about 30% of the retail home and small business network market.
The terms of the transaction are unannounced and the deal is subject to customary closing conditions. Belkin and Cisco expect the deal to close in March 2013.
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1/25/2013 11:31:34 AM
I've owned quite a few Belkin products over the years, including some of their networking products, and must say that the only one that didn't disappoint me was a power bar. Thats not saying much about their brand. I won't buy anything with their brand name on it any more. My only hope is that the Linksys brand drags them up rather than vise versa.
1/26/2013 5:35:41 PM
I think there are usually better margins at the higher end than the low end.
Belkin already has a shitty discount brand, buying Linksys just to cut corners to being poor quality would be a really stupid move.
If they are smart they'll keep or improve the quality of the product line.
One of the reasons Cisco bought Linksys in the first place is because they were afraid Linksys would expand their commercial switches and take a bunch of volume from Cisco's low end.
"What would I do? I'd shut it down and give the money back to the shareholders." -- Michael Dell, after being asked what to do with Apple Computer in 1997
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