Cisco appoints Barclays to sell Linksys unit

Sale could be part of ongoing move to get out of consumer business
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Cisco (Nasdaq: CSCO) on Sunday asked Barclays to help it look for someone to purchase Linksys, its home WiFi networking division.

As reported by Bloomberg, which cited people close to the situation, Linksys could be attractive to TV manufacturers that are integrating WiFi into their devices and want a well known brand. However, the sources added that since it's a mature business with low margins, Cisco won't get anywhere near the $500 million they paid for it in 2003.

Neither Karen Tillman, a spokeswoman for Cisco, nor Marc Hazelton, a spokesman for Barclays, would comment.

Cisco's move to sell Linksys signals the company is another step closer to leaving the consumer business. It made its first move in this direction last year when company CEO John Chambers laid off 7,800 employees and shut down the Flip video camera business.

This July the vendor cut 1,300 employees, or about 2 percent of its workforce, a move it said was designed to cut costs and simplify its overall structure.

Besides Linksys, Cisco has a large stake in the broader home video networking market via its Scientific Atlanta set-top-box division and NDS.

As it sees more attacks on its traditional routing business, Cisco has been focused on increasing its software capabilities, most recently purchasing Cariden, a provider of network planning, design and traffic management solution.

In addition to Cariden, the vendor has been building up its own Software Defined Network (SDN) capabilities with the funding of a new 'spin in' SDN company called Insieme. These SDN capabilities tie into Cisco's ongoing moves into the cloud data center segment, which grew 61 percent to $417 million in its fiscal first quarter

For more:
- Bloomberg has this article

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