Oct. 23 (UPI) -- Cisco Systems Inc. announced on Monday it will acquire BroadSoft Inc., maker of cloud-based communications software, for $1.9 billion.
The agreement indicates that Cisco, based in San Jose, Calif., is moving further away from router and server manufacturing and sales and into sales of software and services. With BroadSoft, headquartered in Gaithersburg, Md., Cisco will acquire revenue from recurring subscription-based services.
BroadSoft's cloud voice and contact center solutions can complement Cisco's hardware and services portfolio, a Cisco statement said.
The deal, valued at $1.9 billion, includes BroadSoft debt. The acquisition is expected to close during the first quarter of 2018, subject to regulatory review.
BroadSoft's stock has increased about 31 percent in value since the start of the year. It traded at $53.90 per share at Friday's close. Trading in the stock was halted on Monday.
Cisco has risen about 13 percent this year, and closed Friday at $34.25 per share. It rose 0.6 percent in Monday's pre-trading.