[Techtaffy Newsdesk]

VMware has signed a definitive agreement to acquire Nicira, a company in the software-defined networking (SDN) and network virtualization for open source space. The purchase price is approximately $1.05 billion in cash plus approximately $210 million of assumed unvested equity awards. The acquisition is subject to regulatory approvals and other customary closing conditions.  The parties expect the acquisition to close during the second half of 2012.  The acquisition has been approved by the boards of directors of both VMware and Nicira and the stockholders of Nicira.

VMware plans to continue to support the open principles and technologies, including the Open vSwitch to connect physical networks and multiple hypervisors and the open extensibility framework to implement business-level policies from any cloud management system.

Nicira is a privately held startup. Investors in the company include Andreessen Horowitz, New Enterprise Associates (NEA) and Lightspeed Venture Partners, along with Diane Greene and Andy Rachlefff.

[Image Courtesy: Nicira]