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Extreme Networks To Acquire Brocade's Data Center Networking Business

SAN JOSE, Calif. and SINGAPORE, March 29, 2017 /PRNewswire/ -- Extreme Networks, Inc. (EXTR) and Broadcom Limited (AVGO) today jointly announced that they have entered into an agreement for Extreme to acquire Brocade Communications Systems, Inc.'s data center switching, routing, and analytics business from Broadcom following Broadcom's acquisition of Brocade. Brocade's data center networking business will be sold to Extreme for $55 million in cash, consisting of $35 million at closing and $20 million in deferred payments, as well as additional potential performance based payments to Broadcom, to be paid over a five-year term.

Extreme expects the acquisition to be accretive to cash flow and earnings for its fiscal year 2018 and expects to generate over $230 million in annualized revenue from the acquired assets. The acquisition is expected to close within 60 days following the closing of Broadcom's acquisition of Brocade.

"The addition of Brocade's data center networking business significantly strengthens our position in the expanding...