In a move that positions VMware for battle with Cisco Systems, the virtualization giant has signed a definitive agreement to acquire SD-WAN provider VeloCloud Networks.
VeloCloud has recently been the subject of acquisition rumors, and acquiring the company will allow VMware to build on its NSX network virtualization platform and expand its networking portfolio into high-end automation, application continuity, branch transformation and security, VMware said in a statement Thursday morning.
VMware and networking powerhouse Cisco have seized on the opportunity presented by the SD-WAN market, which seeks to connect large enterprise networks using software rather than proprietary hardware.
Cisco in May acquired SD-WAN startup Viptela for $610 million.
VMware said it intends to close the VeloCloud acquisition in the fourth quarter of its 2018 fiscal year, which ends in early February. Terms of the deal were not disclosed. VeloCloud has more than 1,000 customers, including wireless giants like AT&T and Vonage.