Cisco has agreed to acquire IT services specialist newScale in an effort to bolster its cloud computing services.
The privately-held company develops tools to help enterprises automate services and set up cloud computing deployments.
Cisco believes that the acquisition could bolster its cloud computing platforms and streamline enterprise migration from on-premise systems.
"Cloud computing represents a major shift in the evolution of the internet, and as more customers migrate from traditional IT infrastructures, the need for rapid self-provisioning and efficient management becomes increasingly critical," said Cisco Services senior vice president Parvesh Sethi.
"With the acquisition of newScale, Cisco will be able to accelerate the deployment of cloud services through a service catalogue and self-service portal that allows customers to easily manage their IT infrastructures."
The move could pay big dividends for Cisco, according to industry analysts. Forrester Research analyst Glenn O'Donnell said in a blog post that Cisco may reap big benefits from a relatively low-cost merger.
"It is big in the sense that Cisco needed the kind of capabilities offered by newScale, and newScale has proven to be one of the most innovative and visible players in that market segment," O'Donnell wrote.
"The market segment in question is what has been described as 'the tip of the iceberg' for the advanced automation suites needed to create and operate cloud computing services."
Cisco said expects to close the acquisition by the end of its second financial quarter. Terms were not disclosed.
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