Cisco Snaps Up Starent for $2.9 Billion

SAN JOSE (TheStreet -- Cisco (CSCO Quote) has thrown down $2.9 billion to buy Starent Networks (STAR Quote) in an attempt to boost its mobile Internet story.

The Tewksbury, Mass.-based firm had recently been touted as a potential Cisco acquisition target, underlining the company's desire to tap telecom firms' next-generation networks.

Under the terms of the deal, Cisco will pay $35 in cash per Starent share, and assume aggregate equity awards for a total purchase price of $2.9 billion. Starent's shares closed at $29.03 Monday, which means that Cisco is paying a 20% premium for the mobile content specialist.

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Cramer said his thesis was once again proven by today's announcement that networking giant Cisco (CSCO Quote), which he also owns for his Action Alerts PLUS portfolio, is buyingStarent Networks (STAR Quote), whose technology is at the heart of the mobile Internet for a 20% premium. How strong are the mobile Internet stocks? He said both stocks rose on the news.