Cisco has hired bankers to assist it with a sale of its Linksys consumer networking division, according to a published report.
Bloomberg reported Sunday that Cisco brought on Barclays Plc to help it find a buyer for the Linksys business, citing anonymous sources "with knowledge of the situation."
Linksys-for-sale rumors began popping up as early as May 2011 following Cisco's shuttering of the Flip video camera business it had acquired with Pure Digital. Cisco's global restructuring over the past 18 months has seen it shift away from many of its consumer-focused businesses; in addition to Flip, it also shut down its Umi personal telepresence offering. It's still strong in the set-top box and integrated service provider video markets, thanks to Scientific Atlanta and recently acquired NDS.
Cisco acquired Linksys in March 2003 for about $500 million. Linksys was fast growing at the time and anchored Cisco's consumer ambitions, a segment it was saying as recently as 2009 it wanted to grow by as much as $10 billion. For its 2012 fiscal year, Cisco's "other products" category -- where it counts Linksys for P&L purposes -- declined 16.3 percent from 2011, from about $1.32 billion to about $1.03 billion.
[Related: 20 Take-Aways From Cisco's Financial Analyst Conferene]
Branding confusion between Linksys and Cisco's small-business-focused products hasn't been infrequent; Cisco in 2010 changed up the branding again so that the Linksys name applied only to consumer-grade products sold mostly through retailers. Earlier this year, Cisco was forced to apologize -- twice -- for security concerns following a firmware update to some Linksys Wi-Fi routers.
Cisco, meanwhile, has been revving up its M&A engines again following a slower pace of acquisition during the restructuring. It bought 10 companies in calendar year 2012, including network planning and design specialist Cariden Techologies, whose acquisition Cisco closed Monday.
PUBLISHED DEC. 17, 2012
