Cisco has announced that it has made an investment in Nuova Systems, Inc. to accelerate next-generation product development in the data center. As a result of Cisco's financial commitment, Nuova Systems will become a majority-owned subsidiary of Cisco.

Cisco has committed certain technology and $50 million of funding to Nuova Systems with the possibility of up to $42 million in additional funding in the future. The subsidiary will be approximately 80% owned by Cisco, with the remaining 20% interest held by employees of the subsidiary. Because of Cisco's majority ownership interest, the accounts of the subsidiary will be consolidated with the accounts of Cisco starting in fiscal year 2007.

Nuova Systems' product development efforts will complement Cisco's current data center product portfolio which includes the Catalyst 6500, Cisco's core enterprise networking platform, the MDS line of storage switches, SFS server networking switches and application networking solutions for accelerating applications within the data center and to the rest of the enterprise.