Cisco Plans To Acquire Hyperconvergence Startup For $320 Million

Shares of Cisco Systems Inc. were up less than 1% Monday morning after the company said it plans to acquire Springpath Inc., a hyperconvergence startup, for $320 million in cash and equity awards. Hyperconvergence has been heating up in the tech space, as the software combines storage and computing functionality in a hybrid-cloud environment. Hewlett Packard Enterprise Co. made a move into the space this year, with a$650 million cash acquisition of Simplivity. Cisco said it has been working with Springpath since the beginning of 2016, when they worked to launch HyperFlex, Cisco's own hyperconvergence system. Cisco's acquisition is expected to close in the first quarter of Cisco's 2018 fiscal year, which runs until Oct. 28. Shares of Cisco have lost 4.3% in the past month, while the S&P 500 has lost 2%.