Chambers Unrepentant

When it comes to swallowing companies, Cisco likes them whole.

Cisco C.E.O. John Chambers has not lost his voracious appetite for buying companies and feeding them to his networking giant. "Our acquisitions strategy will always be to integrate them," he said in an interview the Condé: Nast Portfolio.

Pity then Scott Weiss, founder of IronPort Systems. Last summer, he sold his online security firm to Cisco for $830 million. And last week the Wall Street Journal published an article suggesting that the IronPort deal was evidence of Cisco becoming warm and fuzzy. "Cisco would buy IronPort, but let it operate as a stand-alone unit, with its own managers, brand name, engineers and salespeople," wrote Bobby White and Vauhini Vara.

Really? IronPort has been allowed to remain fairly autonomous - for now. But did anyone check on the title Weiss is now wearing?
The onetime IronPort C.E.O. is now vice president and general manager of the Security Technology Group at Cisco.

Chambers explained that what may look like a new strategy is not. The time between deal close and digestion by Cisco has always been variable. "Every case is different, it depends on each company," he said, offering up Scientific Atlanta and WebEx as examples.

Two years after purchase, Scientific Atlanta has been renamed Cisco Service Provider Technology Group; meanwhile, WebEx, bought one year ago, now bears "Cisco Web Meetings and Collaboration Solutions" beside its green and blue logo. Not quite as sexy as just plain WebEx.

Despite Chambers penchant for snapping up companies - 129 and counting - he added, "you'll never see me do a hostile takeover, period."

So would he advise Microsoft C.E.O. Steve Ballmer to forget his threatened proxy fight for Yahoo? "No," Chambers replied, noting that hostile bids have succeeded. "For instance, Oracle has shown it can work," he said. "Hostile bids depend on what your strategy and goals are. It all goes back to cultures, what you are and are not."

One thing for sure, when it comes to mergers and acquisitions, there is no such thing as a merger. At some point it may make sense for Chambers to rebrand IronPort as part of Cisco. And if Ballmer is successful, it may make sense for him to do the same. Good-bye Yahoo!

by Blaise Zerega