Sun Acquires Cobalt Networks

Sun Microsystems Inc. and Cobalt Networks Inc. announced that they have entered into an agreement in which Sun will acquire Cobalt in a stock-for-stock merger. Cobalt is a supplier of server appliance products. The acquisition accelerates Sun’s entry into the growing server appliance market and bolsters its long-standing focus on network computing.

Under the terms of the merger agreement, each share of Cobalt common stock will be converted into 0.5 Sun, resulting in an aggregate purchase price of approximately $2.0 billion. The acquisition will be accounted for as a purchase, and is expected to be completed during Sun’s second quarter of fiscal 2000, which ends December 31, 2000.

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