This time next month Brocade will no longer have a data centre business arm
Portfolio to help new owner server dozens of market verticals including education, hospitality, manufacturing and government.
Extreme Networks (NASDAQ: EXTR) expects to close over the next 30 days the acquisition of Brocade Communications Systems’ (NASDAQ: BRCD) Switching, Routing and Analytics (SRA) data centre business.
The transaction, estimated at $55m is still subject to the satisfaction or waiver of customary closing conditions.
Extreme Networks said it expects the transaction to be accretive to cash flow and earnings for its fiscal year 2018, which began on July 1, and expects to generate over $230m in annualised revenue from the acquired assets.
As part of the transaction, Extreme will acquire customers, personnel and technology assets from Brocade.
The company will use the portfolio to build its enterprise market reach in several verticals including education, hospitality, healthcare, retail, transportation and logistics, manufacturing and government.
Ed Meyercord, President and CEO of Extreme Networks, said: “We expect this agreement directly with Brocade to accelerate our ability to close our acquisition of the data centre business.
“This is a very positive development for all stakeholders, but especially for customers, partners and employees of Brocade’s data centre networking business.
“Given all of the work that has gone into our business integration planning and our proposed product roadmap, Extreme is now poised to bring this deal over the finish line.”
Lloyd Carney, CEO of Brocade, said: “We believe this decision will position the business for continued success, and is in the best interests of our shareholders, customers, partners and employees aligned with the business.
“Extreme’s complementary portfolio of products, coupled with its planned continued investment into our roadmap and its commitment to continued support of our products, make it a great fit for our business and a positive outcome for our stakeholders.”