Akamai to Buy Cotendo for $268M

Some big acquisition news before the holidays here. Cambridge, MA-based Akamai Technologies (NASDAQ: [[ticker:AKAM]]), the Web delivery and networking giant, said today it is acquiring a competitor, Sunnyvale, CA-based Cotendo, for $268 million in cash. The deal, which has been rumored for the past month, is expected to close in the first half of 2012.

Akamai has been positioning itself as a provider of a secure software platform for businesses to reach customers via Web, mobile, and cloud. Cotendo competes with Akamai in the realm of accelerating Web and mobile applications. The California-based company started in 2008 and has about 100 employees, more than half of them based in Israel.

About a year ago, Akamai and MIT filed a lawsuit against Cotendo alleging patent infringement. Presumably that case is resolved now.

This is a relatively rare case of a Boston tech company acquiring a Silicon Valley company. Most of the other big deals this year have gone the other way (such as Oracle-Endeca, Google-ITA, eBay-Where, and HP-Vertica).

Author: Gregory T. Huang

Greg is a veteran journalist who has covered a wide range of science, technology, and business. As former editor in chief, he overaw daily news, features, and events across Xconomy's national network. Before joining Xconomy, he was a features editor at New Scientist magazine, where he edited and wrote articles on physics, technology, and neuroscience. Previously he was senior writer at Technology Review, where he reported on emerging technologies, R&D, and advances in computing, robotics, and applied physics. His writing has also appeared in Wired, Nature, and The Atlantic Monthly’s website. He was named a New York Times professional fellow in 2003. Greg is the co-author of Guanxi (Simon & Schuster, 2006), about Microsoft in China and the global competition for talent and technology. Before becoming a journalist, he did research at MIT’s Artificial Intelligence Lab. He has published 20 papers in scientific journals and conferences and spoken on innovation at Adobe, Amazon, eBay, Google, HP, Microsoft, Yahoo, and other organizations. He has a Master’s and Ph.D. in electrical engineering and computer science from MIT, and a B.S. in electrical engineering from the University of Illinois, Urbana-Champaign.