Exits – Cisco snaps up Atlantech

At the beginning of March, Cisco Systems announced a definitive agreement to acquire Atlantech, the Glasgow-based network element management software specialist, in a share deal worth approximately $180 million (186.2 million). The deal delivered an IRR of more than 50 percent over seven years to 3i, Atlantech’s principal venture backer.

Founded in 1992, Atlantech received first round venture funding from 3i and Scottish Enterprise in the following year. 3i led three further funding rounds, investing a total of GBP4 million in the company and bringing in other backers including Singapore’s Vertex, General Atlantic Partners and Vision Capital. Last year, Cisco invested $7 million to take a 9.5 percent stake in Atlantech. Kevin Lyon, 3i’s director of technology investment for Scotland, reports that the group has made a profit of GBP13 million on its investment and describes the Atlantech transaction as “a validation of our strong technology push during the past two to three years”.

The exit from Atlantech is the second high-profile realisation via sale to a US acquirer from 3i’s Scottish technology portfolio, following the sale of Roslin Bio-Med to Geron Corporation last spring.

Atlantech’s software interacts with other existing management systems used in service provider networks. Cisco is acquiring the firm to furnish service providers and ecosystem partners with a single integrated platform for enabling network management functionality across multiple diverse networks.