Cisco launches $5 bn debt sale in acquisition spreePublished on Tue, Nov 10, 2009 at 09:38 | Source : Reuters Updated at Tue, Nov 10, 2009 at 12:36
Top While Cisco is cash rich, with USD 35.4 billion in cash and investments at the end of the last quarter, most of it was overseas as a result of its global operations, with only USD 4.7 billion held in the "Moving cash into the She said proceeds were likely to be used to fund Cisco's planned acquisition of wireless equipment maker Starent Networks Corp for USD 2.9 billion. Cisco has said it plans more acquisitions ahead. It is also planning to buy Norwegian videoconferencing company Tandberg ASA although that deal will use overseas cash. IFR, a Thomson Reuters service, said the latest offering consists of USD 500 million of five-year notes launched at 67 basis points more than comparable US Treasuries, and USD 2.5 billion of 10-year notes launched at 100 basis points more than Treasuries. The third part is USD 2 billion of 30-year bonds launched at 130 basis points more than Treasuries. Acquisitions have been a key part of Cisco's growth strategy over the past decade, and the company has expanded from routers and switches to a wider range of products like cable set-top boxes and business software. Since John Chambers took the CEO role in 1995, it has grown from USD 1.2 billion in annual revenue to around USD 40 billion. Barclays, Credit Suisse and Deutsche Bank are the active lead managers, and Bank of America, HSBC and JPMorgan are the passive lead managers, said IFR.
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