Cisco to Take Charge for Pending Deal

Cisco Systems Inc., the No. 1 maker of equipment that directs Internet traffic, said it would take a noncash charge of as much as $500 million for its pending acquisition of San Jose storage switch maker Andiamo Systems Inc.

Cisco said in a filing with the Securities and Exchange Commission that a new regulation requires it to consolidate Andiamo on its financial statement July 27, the first day of its fiscal year 2004.

In August, Cisco announced its intention to buy Andiamo for up to $2.5 billion in Cisco stock. It said the deal would close by July 2004. San Jose-based Cisco shares fell 69 cents to $15.94 on Nasdaq.