Cisco Eyes Up China

9:10 AM -- Cisco Systems Inc. (Nasdaq: CSCO) has offered $44.5 million for the set-top box business of Chinese cable digital equipment vendor Digital Video Networks (DVN), with which Cisco has also struck a partnership.

The move comes as the Chinese cable sector undergoes significant upheaval. There are currently 160 million cable customers in China (set to rise to 200 million during the next five years), only about a third of which are connected to digital systems.

The Chinese government has set a target of 2015 for the whole cable sector to be digitized, so the business opportunities for wide area and home network infrastructure upgrades is enormous.

With that in mind, $44.5 million looks like a very cheap entry price into a potentially very lucrative market for Cisco, which has been very busy lately on the M&A front. (See Cisco to Acquire ScanSafe, Cisco to Buy Starent for $2.9B, ITU: Cisco's Chambers Hints at More M&A, and Cisco Bets $3B on Tandberg .)

— Ray Le Maistre, International News Editor, Light Reading

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