SAN JOSE, Calif., NEW YORK, and OSLO, Norway, December 3, 2009 – In the voluntary public cash offer to acquire all outstanding shares in TANDBERG, Cisco (NASDAQ: CSCO) announces that following the expiration of the offer period at 5:30 pm CET on December 3, 2009, Cisco controls approximately 89 percent of the outstanding shares in TANDBERG (OSLO: TAA.OL).

The received acceptances represent a lower acceptance ratio than the 90 percent condition to the offer set out in Section 1.7 in the offer document dated October 7, 2009. However, Cisco has decided to waive this 90 percent condition.

There may be adjustments to the preliminary result due to possible corrections and changes following registration with the Verdipapirsentralen (VPS). The final result will be published as soon as it is available.

Cisco intends to complete the voluntary public cash offer subject to the satisfaction or waiver of the remaining conditions to the offer as set forth in the offer document, Section 1.7, as soon as possible. Assuming completion of the offer, Cisco will in relation to the remaining shares in TANDBERG proceed as required under chapter 6 of the Norwegian Securities Trading Act.

SAN JOSE, Calif., NEW YORK, and OSLO, Norway, December 3, 2009 – In the voluntary public cash offer to acquire all outstanding shares in TANDBERG, Cisco (NASDAQ: CSCO) announces that following the expiration of the offer period at 5:30 pm CET on December 3, 2009, Cisco controls approximately 89 percent of the outstanding shares in TANDBERG (OSLO: TAA.OL).

The received acceptances represent a lower acceptance ratio than the 90 percent condition to the offer set out in Section 1.7 in the offer document dated October 7, 2009. However, Cisco has decided to waive this 90 percent condition.

There may be adjustments to the preliminary result due to possible corrections and changes following registration with the Verdipapirsentralen (VPS). The final result will be published as soon as it is available.

Cisco intends to complete the voluntary public cash offer subject to the satisfaction or waiver of the remaining conditions to the offer as set forth in the offer document, Section 1.7, as soon as possible. Assuming completion of the offer, Cisco will in relation to the remaining shares in TANDBERG proceed as required under chapter 6 of the Norwegian Securities Trading Act.

SAN JOSE, Calif., NEW YORK, and OSLO, Norway, December 3, 2009 – In the voluntary public cash offer to acquire all outstanding shares in TANDBERG, Cisco (NASDAQ: CSCO) announces that following the expiration of the offer period at 5:30 pm CET on December 3, 2009, Cisco controls approximately 89 percent of the outstanding shares in TANDBERG (OSLO: TAA.OL).

The received acceptances represent a lower acceptance ratio than the 90 percent condition to the offer set out in Section 1.7 in the offer document dated October 7, 2009. However, Cisco has decided to waive this 90 percent condition.

There may be adjustments to the preliminary result due to possible corrections and changes following registration with the Verdipapirsentralen (VPS). The final result will be published as soon as it is available.

Cisco intends to complete the voluntary public cash offer subject to the satisfaction or waiver of the remaining conditions to the offer as set forth in the offer document, Section 1.7, as soon as possible. Assuming completion of the offer, Cisco will in relation to the remaining shares in TANDBERG proceed as required under chapter 6 of the Norwegian Securities Trading Act.

I'd heard that an increase of 10% to 15% would likely get the deal done, so this improvement seems designed to accomplish two simultaneous goals: to put the acquisition over the top, without sending the message that Cisco will panic and radically pay up when shareholders of acquisition targets hold out for more. That's critical for a company as acquisitive as Cisco, which has done four large deals in just the last 45 days. At Cisco's shareholder meeting on Nov. 12, Cisco CEO John T. Chambers warned that "I'll walk" rather than overpay. "We're not going to pay a price that we don't think is good for shareholders."

One way or another, Chambers needed to get this deal done. He has said that video is his number one strategic priority, and video-conferencing in particular is a great opportunity for Cisco. Few, if any, forms of traffic chew up bandwidth and require more sophisticated routing and switching than videoconferencing--which needs to be not only high-res, but real-time.

And buying Tandberg was clearly the best way to accelerate his grand video plans. The company is not only the market leader in videoconferencing gear, but it's by far the hottest player in the market--not only with the mid-tier conference room systems that are the bulk of the industry, but also for high-end telepresence systems like the ones Cisco sells. Multiple industry sources I've spoken to say Tandberg routinely beats Cisco in deals for these systems, which create the illusion that you're actually sitting in the same room with other attendees, wherever they may be.

Also, Cisco needed to find a way to embrace open standards for its telepresence offerings. Currently, Cisco's systems only work with other Cisco systems, for the most part. That's unacceptable, for a company that built its Internet equipment empire by championing the most important open standard of them all--the Internet Protocol. Analysts say Tandberg is a leader not only in product innovation, but in making its gear inter-operate with other brands.

Here's a video of Chambers and Tandberg CEO Fredrik Halvorsen talking about the deal at the time.

He said that he expects we'll look back and see this as "a major inflection point." He believes the economy bottomed out in the first calendar quarter of 2009, began to recover in the second quarter and gained real momentum in the third. "The recovery is well under way," said Chambers.

Among many highlights, the company saw flat order growth in the US for the quarter ended on Oct. 30--a massive improvement from the 20% year-on-year declines of the last two quarters. While small businesses and phone carriers were much improved, the highlight was spending by US corporations. "We've seen a much faster recovery in their business than we had expected. The company seems to be well on the road to recovery," says Pacific Crest analyst Brent Bracelin. Indeed, Chambers forecast positive revenue growth in the current quarter, and even said it would begin limited hiring--though he warned any employees listening to the call that it would be "very targeted" on jobs that drive productivity growth or help grow into new markets.

The company warned shareholders not to assume the second half of the year would remain strong, and advised analysts not to update their models for the second half of the year given uncertainties about job growth and the sustainability of the recovery. "I just don't want us to get ahead of ourselves," said Chambers.

Still, the company did give a forecast for the current quarter, saying that it expects year over year growth of between 1% and 4%. That's in line with recent years, when the company averaged 3% growth in its second quarter--and much rosier than Wall Street analysts, who expected a revenue declilne. Gross margins could fall, due to product mix and some less expensive new products.

Given Cisco's huge size, product breadth and importance as a proxy for the health of the Internet, this is great news for tech in general. Bracelin notes that this marks the tenth out of twelve companies that sell primarily sell to corporations that has exceeded Wall Street expectations.

Some in the press have been raising questions about Chambers' long-term strategy, particularly the amount it has spent on acquisitions and on moving into dozens of "market adjacencies"--from Flip video cameras to heavy duty servers. Bracelin isn't one of them. With so many companies moving to virtualized data centers, "Cisco's goal is to be there as companies go through the biggest transition in many years," he says. "I think Cisco is doing all the right things, and it's way too premature to judge Cisco's strategy, when we're just coming out of the worst downturn since the Great Depression."

Certainly, Cisco seems as confident as I've ever seen it--and maybe more confident than any company I've ever seen. As Chambers pointed out, it did four large acquisitions in the last month, including $3 billion acquisitions of wireless services infrastructure company Starent and videoconferencing specialist Tandberg (although the bill for that deal may go up, given protests by Tandberg shareholders). What's more, the company is clearly ignoring critics who doubt that strategy. The evidence: the company okayed a $10 billion stock buyback. As Chambers told analysts, "There are some CEOs that are stepping on the gas pedal, but very few are doing what we're doing and pushing the gas pedal down all the way."