As part of its strategy to develop innovative data center, virtualization and cloud technologies, networking giant Cisco (News - Alert) said it will acquire software company Cloupia for $125 million. The Santa Clara, Calif.-based company makes software that automates converged data center infrastructure.

Cloupia’s infrastructure management software will enhance Cisco’s Unified Computing System (UCS) and Nexus switching portfolio and allow enterprises and service providers to manage pools of computing power, network services, storage and virtual machines as a unified whole.

Cisco, which is based in San Jose, Calif., plans to integrate Cloupia’s employees into Cisco’s Data Center Group. The company’s data center strategy is based on the premise of making it easier for customers to deploy a unified and integrated infrastructure that is efficient, fast, and flexible, according to David Yen, senior vice president and general manager, Cisco Data Center Business Group.

“This strategy involves the delivery of the industry’s most comprehensive data center networking portfolio, which includes physical and virtual products that support multiple hypervisors and storage stacks,” Yen said in a statement.

He said the addition of Cloupia’s automation software enhances the efficiency of such unified data center infrastructures, helping to accelerate the transition from physical to cloud environments more quickly and effectively.

The acquisition is expected to close in the second quarter of Cisco’s fiscal year 2013.

Cisco shares jumped this week following strong earnings growth and a steady financial forecast, MarketWatch reported. On Nov. 13, Cisco reported an 18 percent gain in earnings for the quarter ended Oct. 27, with cost controls helping boost the bottom line beyond the six percent growth in overall revenue. By mid-day Wednesday, shares of Cisco rose more than 6.5 percent to $17.95. The company’s forecast for the current period was in line with estimates.

“We delivered record results this quarter – with revenue growth of 6 percent and strong earnings per share growth – demonstrating our vision and strategy are working,” said John Chambers (News - Alert), chairman and CEO of Cisco. “Our innovation engine, operational discipline and on-going evolution are enabling us to differentiate in the market.”

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