Cisco Systems has acquired privately held Nashoba Networks at the same time as it faces a lawsuit to prevent its takeover of Telebit.
CEO John Chambers said Cisco will continue to buy over the next year.
A source in the US said areas of interest include security and XDSL.
Nashoba is a Token Ring switching specialist.
The buy comes in the middle of a class action lawsuit against Cisco and Telebit alleging that the takeover offer is below Telebit's market value. The cash and stock deal was valued at around $200 million, at $13.35 per share, which represented a 21.4 per cent premium for Telebit shares.
Cisco and Telebit said they will fight the suit.
The Nashoba buy is also subject to shareholder and regulatory approval.
It is expected to be finalised by mid September.
Cisco denied the firm's penchant for acquisition indicated a lack of technical skill in-house. Paul Mountford, Cisco UK MD, said: 'We do have the ability within Cisco, but it just takes too long to develop products in-house.
'To maintain our position we need these products now. With the Nashoba deal we have the full monty in Token Ring.'
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