Set-top box maker Arris is looking to take over Brocade’s networking equipment operations for up to USD 1 billion, Reuters reported, citing sources familiar with the matter. The parties are in talks around a deal that would enable Arris to offer high-end mobile broadband devices to customers and ensure that Broadcom, which agreed to buy Brocade in November, will not own a business that competes with its top clients, such as Cisco Systems.
Brocade is in discussion with a number of companies about the operations and there is no certainty at this point that Arris will prevail, the sources said, adding that a decision is expected by the end of the month. Arris, Broadcom and Brocade declined to comment on the report.
In the potential deal with Brocade, Arris wants to buy the company’s network edge business, which is the most valuable of the assets being sold, according to the sources. Arris is not in talks to buy other parts of the business being divested by Brocade, including data centres, switching and software, the sources added.
Arris last year completed the acquisition of Pace for USD 2.1 billion, and incorporated itself in Britain in a deal structured as a corporate tax inversion.