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Networking titan Cisco has agreed to purchase Israeli video software company NDS for a cool $5 billion, the company announced Thursday morning.

NDS focuses on software that delivers video and interactive entertainment to set-top boxes and across other devices. The company said it can “enable subscribers to intuitively view, search and navigate digital content anytime, anywhere and on any device.” Private-equity firm Permira owns 51% of NDS, while media company News. Corp owns 49%.

The acquisition will most likely help Cisco with its many video and content delivery initiatives. The company offers products like Videoscape for set-top boxes and TelePresence for video conferencing.

“Our strategy has always been driven by customer need and on capturing market transitions,” Cisco CEO John Chambers said in a statement. “Our acquisition of NDS fits squarely into this strategy, enabling content and service providers to deliver new video solutions that leverage the cloud and drive new monetization opportunities and service differentiation.”

Cisco will pay around $5 billion, including the assumption of debt, for NDS. The company expects the deal to close in the second half of 2012.

Cisco’s shares are trading down about 1 percent in early trading on the NASDAQ exchange.

Woman hugging money photo: suravid/Shutterstock

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