ARRIS Acquisitions Address New Venues, Cablecos

By Paula Bernier
Executive Editor, TMC

ARRIS late last month cut a deal with Broadcom to purchase the Ruckus Wireless and ICX business from Brocade (News - Alert) Communication Systems Inc. for $800 million in cash. This followed Broadcom’s acquisition of Brocade for $5.9 billion in November.

The deal will enable ARRIS to expand its converged wired and wireless networking portfolio beyond the home into education, enterprise, hospitality, MDU, and public venue environments. In addition to the new products and customer reach, the Ruckus deal gives ARRIS 1,600 new employees and an extensive network of enterprise channel partners.

In an interview with Multichannel News this week discussing the deal, ARRIS CEO Bruce McClelland said the company’s cableco customers like Charter Communications and Comcast (News - Alert) will eventually all become wireless operators. And, he indicated, the Ruckus deal will help ARRIS assist them with that. However, it should be mentioned that ARRIS has been reselling the Ruckus portfolio for years.

Ruckus COO Dan Rabinovitsj will stay on to run the new ARRIS business unit following the close of the deal. The deal is expected to close by the end of July.

That will leave Brocade with the storage area networking business of its previous deal. Broadcom sells semiconductor connectivity solutions used in wired infrastructure, wireless communications, enterprise storage and industrial applications. Cisco (News - Alert), HPE, and Intel are its largest customers. And the company is ranked No. 4 in terms of semiconductor sales, according to anysilicon.

The move by Broadcom to acquire Brocade (and Avago Technologies’ move to buy Broadcom in May of 2015) followed a long wave of acquisitions that have been moving the chip industry. For example, Qualcomm late last year announced plans to acquire NXP Semiconductors (News - Alert) NV for $38 billion. NXP sells semiconductors for the automotive, microcontroller, secure identification, network processing, and RF power applications. And earlier last year Intel closed a deal with Altera (News - Alert), making it a dominant player of FGPA-based NFV solutions.