Cisco invests $150 million in VMware

After Intel also Cisco wants a piece of VMware.

Quoting from the VMware official announcement:

VMware, Inc. today announced that Cisco Systems will acquire an equity stake in the company.

Cisco will purchase $150 million of VMware Class A common shares currently held by EMC Corporation, VMware’s parent company, subject to customary regulatory and other closing conditions including Hart-Scott-Rodino (HSR) review. Upon closing of the investment, Cisco will own approximately 1.6 percent of VMware’s total outstanding common stock (less than one percent of the combined voting power of VMware’s outstanding common stock). VMware has agreed to consider the appointment of a Cisco executive to VMware’s board of directors at a future date.

In addition, VMware and Cisco have entered into a routine and customary collaboration agreement that expresses their intent to expand cooperative efforts around joint development, marketing, customer and industry initiatives. Through improved coordination and integration of networking and virtualized infrastructure, the companies intend to foster solutions for enhanced datacenter optimization and extend the benefits of virtualization beyond the datacenter to remote offices and end-user desktops…

This move is part of a strategy, possibly started with VMware involvement in VFrame development, which may be further detailed during Cisco keynote at VMworld 2007.