News & Analysis » US

Cisco To Acquire Privately-held Arch Rock; Terms Not Disclosed - Update

(RTTNews) - Networking products maker Cisco Systems, Inc. (CSCO) on Thursday announced its intent to acquire privately-held Arch Rock Corporation, a provider of wireless network technology for smart-grid applications. The deal, whose terms were not disclosed, is expected to complement yesterday's announcement of collaboration between Cisco and Itron. Cisco said the partnerships would enable True IP-Standards-Based Smart-Metering Communications.

Cisco believes the acquisition would accelerate its ability to facilitate the utility industry's transition to an open and interoperable smart grid. Arch Rock's technology is designed to enable utilities to connect smart meters and other distributed intelligent devices over a scalable, highly secure, multi-way wireless mesh network.

Laura Ipsen, senior vice president and general manager of Cisco's Smart Grid business unit said, "Arch Rock's wireless mesh technology enhances Cisco's IP-based, end-to-end smart-grid offerings."

Financial terms of the transaction were not disclosed. The acquisition is subject to various standard closing conditions and is expected to be complete in the second half of calendar year 2010.

The Cisco connected Grid portfolio covers energy management from delivery to the home, including network solutions for smart grid substation automation and home energy control.

Cisco's Substation Automation enables power grid operators to collect and analyze data about power generation, transmission, distribution, and consumption-all in near real time. Smart grid communication technology provides predictive information and recommendations to utilities, their suppliers, and their customers on how best to manage power.

Cisco expects the acquisition of Arch Rock to enable it to offer a comprehensive and highly secure advanced metering infrastructure solution that is fully IP and open-standards based.

Upon closure, the Arch Rock team would become part of Cisco's Smart Grid business unit.

Wednesday, Cisco had announced a strategic alliance with Itron Inc. (ITRI) towards transitioning smart metering technology into an open and interoperable, enterprise-class network for utilities. Under terms of the agreement, Itron and Cisco will jointly develop the reference design that defines a standard for smart grid field area and smart metering network communications, utilizing the latest version of the Internet Protocol-IPv6.

CSCO closed Wednesday's regular trading on the Nasdaq at $20.26. Over the past year, the stock has traded in a range of $19.82 - $27.74.