Shares of Acacia Communications Inc.
rocketed 40% toward more than 2-year high in premarket trading Tuesday, after the optical networking products company announced by agreement with Cisco Systems Inc.
in a deal valued at $ 2.6 billion. Cisco's stock slipped 0.9% ahead of the open. Under terms of the agreement, Cisco will pay $ 70 in cash for each Acacia outstanding share, at 46% premium to Monday's closing price of $ 48.06. "The interchange technologies are becoming more strategic," said David Goeckeler, general manager of Cisco's networking and security business. "The acquisition of Acacia will allow us to build our customers' most demanding requirements." Acacia's stock has dropped 17% over the past three months, while Cisco shares have gained 1.8% and the Dow Jones Industrial Average
has advanced 2.5%.