Extreme Networks acquires Aerohive Networks

Network provider Extreme Networks has acquired the provider of cloud-based network management Aerohive Networks. The company announced this today. The acquisition fits in well with the strategy that the company has been pursuing in recent years. In addition, the acquisition significantly expands the Extreme portfolio in a number of key areas, such as cloud-based network management or NAC, WiFi and Edge capabilities.

It was a year of silence on the acquisition front of Extreme Networks, but apparently it has been working behind the scenes on a new acquisition. This time it is Aerohive Networks that the network specialist will add to his portfolio. Previously, it was the turn of the network components of Avaya, Brocade and the WLAN applications of Zebra Networks. Especially recently, Extreme Networks has been busy communicating how well these latest components have been integrated into the company, so much so that a complete new start has been spoken of. Also during Extreme Connect 2019 last May, there was no sign of this upcoming acquisition.

Yet according to the company‘s philosophy – an acquisition must complement the existing portfolio and offer real added value to the customer – it has now been the moment for another acquisition. In total, Extreme Network is now depositing 272 million dollars in cash for Aerohive Networks.

Earlier this year, competitor Juniper Networks made a similar acquisition of Mist Systems, also a specialist for cloud-based network, WiFi and WLAN applications and solutions.

Cloud-based network management and the same verticals

With the acquisition of Aerohive Networks, the network specialist assures itself of a specialist in applications and solutions in the field of cloud management, artificial intelligence, machine learning and cloud-based networking. It focuses on controller-less WiFi applications, branch routers, switches, access points and cloud-based network management. Today, it also offers cloud-based WLAN services. Recently it also launched its first WiFi 6 access points and the first plugable access point in the world.

Aerohive Networks has approximately 30,000 enterprise clients worldwide in various verticals, such as the public sector, education, healthcare and the retail sector. Coincidentally, these are all vertical markets in which Extreme Networks is currently active or wants to be more active. Aerohive Networks offers its products through a subscription model.

Value for Extreme Networks

With a quick look at the portfolio, the acquisition seems very suitable for Extreme Networks. In doing so, the company is seeking to add more functionality to its portfolio for cloud-based network management solutions and for edge environments. The portfolio can also help customers to apply complete edge-to-(multi)cloud based network applications, i.e. the final autonomous network, faster within their environments.

It goes without saying that the applications and solutions now obtained will soon also find their way into the recently launched Extreme Elements philosophy of ‘building blocks for these autonomous networks’. It remains to be seen how the products will find their way in the three pillars that are still maintained: SmartOmniEdge, Automated Campus and Agile Datacenter.

Extreme Networks also hopes to start earning from the revenue stream of the acquired specialist’s subscription model. In this way, it also wants to meet the wishes of its customers for an As-a-Service or subscription model for their services.

Permission

The complete acquisition is expected to be finalized in the first quarter of 2020. In addition, Extreme Networks is dependent on the competent authorities in the United States and, very surprisingly, Germany. Extreme Networks informs us on request that there is a competition issue in the latter country, which requires official permission to be obtained. The network specialist expects to receive this permission.