Arris reportedly near announcing $1B Brocade acquisition


Arris could officially announce its anticipated $1 billion purchase of Brocade Communications Systems as soon as today at 5 p.m. EST, when it presents its fourth-quarter and full-year earnings to investors, Reuters reported, citing anonymous sources. 

These sources cautioned that the deal isn’t signed and could still fall apart. Neither Arris nor Brocade has commented. 

RELATED: Arris reportedly set to bid $1B on Brocade network edge unit

Last month, Arris CFO David Potts told investors that the vendor might transition into serving the wireless needs of its customers. Among Arris’ clients, Comcast is developing a wireless service based on its MVNO relationship with Verizon.

In early November, Broadcom paid $5.9 billion to acquire network gear manufacturer Brocade. 

Brocade is a major supplier in the NFV and SDN market and earlier last year bought Ruckus, which sells Wi-Fi services and equipment to enterprises and service providers, in a deal valued at $1.2 billion. Brocade also offers software and storage products.

Immediately after its Brocade purchase, Broadcom announced that it plans to sell Brocade's networking business. “In terms of our IP Networking business, due to competitive overlap with some of Broadcom’s most important customers, Broadcom will seek a buyer for the business,” Brocade CEO Lloyd Carney wrote on the company’s website.

Reuters said Arris is only looking for the Brocade unit that sells network edge equipment, and not other divisions that sell products like data center gear.  

The speculation comes just a little over a year after Arris closed its $2.1 billion acquisition of rival set-top maker Pace. In his talk last week at a Needham investor event, Potts said the integration of Pace is all but completed.