Cisco to Buy FineGround

SAN JOSE, Calif. -- Cisco Systems® (Nasdaq:CSCO - News) today announced a definitive agreement to acquire privately-held FineGround Networks, Inc. of Campbell, Calif. With its patented technology, FineGround is a leading provider of network appliances that accelerate, secure, and monitor application delivery while minimizing bandwidth usage and maximizing infrastructure capacity in the data center. By integrating FineGround's technology with Cisco's products, Cisco will provide customers with advanced application-acceleration across networks for secure and optimized delivery of web-based applications.

Under the terms of the agreement, Cisco will pay approximately $70 million in cash and options for FineGround. The acquisition is subject to various standard closing conditions, including applicable regulatory approvals, and is expected to close in the fourth quarter of Cisco's fiscal year 2005 ending July 30, 2005.

"This acquisition further enhances Cisco's strategy to converge application acceleration, security and a highly available network infrastructure seamlessly in the data center," said Jayshree Ullal, Senior Vice President and General Manager of Cisco's Security Technology Group. "FineGround augments Cisco's leadership in content and security products enabling customers to accelerate application response time and minimize costs."

FineGround's unique technology uses innovative application-optimization techniques resulting in bandwidth efficiencies, decreased latency, and server offload across the network. In real-world deployments, customers dramatically improve end-user response times by up to 5 times, reduce application bandwidth usage by up to 90 percent, and reduce the load on servers by up to 90 percent. In addition, FineGround solutions allow organizations to secure and mitigate the risk of web-enabled business transactions by incorporating application firewall functions.

FineGround will become part of Cisco's Security Technology Group and CEO Nat Kausik will continue to lead the team. FineGround's products will be sold through Cisco sales and channels, and its technology will be integrated with Cisco's ongoing development in this area. FineGround was founded in June 2000 and has 42 employees.

Cisco Systems Inc.