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Business Briefs

Reported by Star-Bulletin staff & wire

Friday, May 5, 2000

Cisco acquiring 'Net switch maker

SAN JOSE, Calif. -- Cisco Systems Inc. said today it has agreed to buy ArrowPoint Communications Inc., an Internet switch maker that went public five weeks ago. Cisco said it will pay about $5.7 billion in stock to add advanced equipment to manage Web traffic.

The No. 1 maker of computer-networking equipment will exchange 2.1218 shares for each share and option of Acton, Mass.-based ArrowPoint. The agreement values ArrowPoint at $135 a share, just above yesterday's close of $134.81. In Nasdaq trading today, shares in ArrowPoint rose $5.37 to close at $140.19; Cisco's stock rose $4.12 to $67.75. ArrowPoint's shares have more than tripled since a March 31 initial offering.

Cisco is buying ArrowPoint to gain new software to compete better in the Web-traffic management market. ArrowPoint's switches route requests for Web content or online transactions to the computer best able to handle the request.

Report: Heinz makes move for Bestfoods

PITTSBURGH -- H.J. Heinz Co. is prepared to offer $72 a share for Bestfoods in a friendly merger with the maker of Skippy peanut butter, which Tuesday rejected a $66-a-share unsolicited bid from Unilever Plc, USA Today reported.

Heinz Chairman Anthony O'Reilly is trying to persuade Bestfoods Chief Executive Dick Shoemate to rekindle talks that collapsed last year over who would lead the combined company, the newspaper said today, citing unidentified people close to Heinz.

The move could prompt Europe's Unilever to act. The Dutch-British conglomerate has said it may increase its $18.3 billion cash offer or make a hostile bid. Analysts said Unilever is likely to win out as Heinz and other U.S. peers aren't big enough to afford Bestfoods at these prices.

In other news . . .

NEW YORK -- Time Warner Inc. is offering rebates and premium channels to the 3.5 million East Coast customers it cut off from ABC this week during a contract dispute with ABC's parent, Walt Disney Co.