The San Jose, California based Cisco Systems announced on Thursday that it has acquired the manufacturer of the popular Flip Video camcorder, Pure Digital Technologies, in a $590 million deal.

The networking giant, Cisco Systems stated that under the take over deal, it will pay around $590 million in stock to gain control of the 100-person company, Pure Digital Technologies, all its shares, and its healthy gadget startup.

According to a report, Cisco will close the deal in the fiscal fourth quarter that ends in July. Jonathan Kaplan, the chairman and CEO Pure Digital, will become the head of Cisco's consumer business group that markets Linksys brand – Home routers – and wireless home audio systems.

Cisco’s Pure Digital buy out is part of its recent aggressive expansion policy. The company is recently foraying into the arenas beyond its core business of making computer networking gear. Earlier this week, Cisco announced its entry into the blade server market. Cisco Chief Executive John Chambers feels that a weak economy is an opportunity to invest.

The market analysts say that Cisco has a large cash hoard — $29.5 billion in its last quarterly update, and the company is well set to execute its expansion policies.

Pure Digital Technologies is San Francisco, California based technology firm, known for its line of one-time use digital camcorders, and the Flip Video brand of reusable camcorders.