Cisco (NASDAQ:CSCO) Buying Up Small, Strategic Players in Key Markets

Even though Cisco (NASDAQ:CSCO) is sitting on a pile of cash (approximately $39 billion), they are patient and content to continue to make smaller acquisitions in key markets, the latest, announced today, being Inlet Technologies, which they acquired for $95 million.

Inlet focuses on the one of the fastest-growing tech segments: streaming video. Cisco said they made the deal to expand its Videoscape TV platform.

Other recent acquisitions by Cisco were LineSider in December, which develops network management software, and Pari Networks, which the acquired in January, which is a networking management firm.

It appears they're making these acquisition with the intention of building them out themselves, rather than acquire larger firms. It also helps in the sense that they don't have to reveal terms of the deal because of their relatively small size.

That's not to say Cisco won't be acquiring larger companies, as its recent issuance of debt implies. Any company issuing debt is doing it for the purpose of maintaining financial flexibility.

In other words, if a big deal comes along, they have liquidity in place to make an immediate offer.

Cisco is in a solid place to grow organically and via acquisitions; an enviable position to be in without question.