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Brocade to Acquire Ruckus Wireless in $1.5 Billion Deal

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Edward Gately**Editor’s Note: Please click here for a recap of the biggest channel-impacting mergers in Jan.-Feb. 2015.**

Brocade is acquiring Ruckus Wireless in a cash and stock transaction worth about $1.5 billion.

According to Brocade and Ruckus, the combined company is expected to be No. 1 in storage-area networking, No. 1 in service provider Wi-Fi, No. 2 in data center networking, No. 3 in enterprise wireless LAN, and No. 3 in enterprise edge networking in the United States and EMEA.

Brocade's Pete PetersonThe companies expect the transaction, which has been approved by both companies’ boards of directors, to close in Brocade’s third fiscal quarter of 2016.

Pete Peterson, Brocade’s vice president of global channel sales, tells Channel Partners the acquisition will give his company’s partners the “opportunity to have a broader set of products and solutions to sell downstream to the market.” This should provide them the chance to potentially have a more strategic relationship with Brocade, he said.

“Some Brocade channel partners already carry both Ruckus and Brocade products,” he said. “We will continue to encourage and enable partners to sell Brocade’s complete portfolio inclusive of storage solutions, software networking solutions, and wired and wireless LAN networking solutions.”

The Brocade and Ruckus channel programs will continue to operate separately, Peterson said. Post close, “we will begin to evaluate our programs and initiate the process of integration with a combined focus on enhancing partner satisfaction, profitability, ease of doing business and pay-for-performance programs,” he said.{ad}

“There is very little overlap in our partner ecosystems, so we see a lot of synergies between the two companies from a partner and product perspective,” he said. “Ruckus partners who want to participate in Brocade’s standalone partner program pre-close can apply like any other partner. Post close, we will begin the process of integrating our channel ecosystem, enablement and programs. Both programs will continue to operate separately at this time.”

The acquisition will complement Brocade’s enterprise networking portfolio, adding Ruckus’ wireless products to Brocade’s networking services, according to Brocade. It also will strengthen Brocade’s strategic presence in the broader …

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… service-provider space, with Ruckus’ “market-leading Wi-Fi position,” it said.

The Ruckus organization will be led by current Ruckus CEO Selina Lo, who will report directly to Brocade CEO Lloyd Carney.

Ruckus provides wireless services for more than 65,300 enterprise, service-provider, government and small-business customers globally.

The acquisition is expected to accelerate cross-selling activities into the respective companies’ partner and customer bases, opening up new revenue opportunities for the combined company across a variety of verticals, including large enterprises, K-12 and higher education, government, hospitality and service providers. Also, it will strengthen Brocade’s ability to pursue emerging market opportunities around 5G mobile services, Internet of Things (IoT), Smart Cities, OpenG technology for in-building wireless and LTE/Wi-Fi convergence.

“This strategic combination will position us to expand our addressable market and technology leadership with Ruckus’ fast-growing wireless LAN products, and supports our vision to deliver market-leading New IP solutions that enable the network to become a platform for innovation,” Carney said. “History shows that focused, pure-play companies often innovate faster, are more agile and deliver better value to their customers. With the rapidly evolving requirements of the digital transformation era, we are positioning ourselves to lead where technology is headed. We believe that combining our portfolios will provide significant benefits to our customers and will enable us to accelerate our growth and value creation.”


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