Cisco plans to acquire privately held Tidal Software, a maker of application management and automation software, paying about $105 million in cash plus retention-based incentives.

Cisco says that the acquisition will create significant opportunities for both Cisco and its partners through the delivery of partner-led services that leverage Cisco’s application management capabilities.

Although privately held, Tidal Software says that in the quarter ended Dec. 31, 2008, its professional services and maintenance revenues had climbed significantly, growing by 26 percent over the same period a year earlier.

According to Cisco, the addition of Tidal Software will help customers get more from their business applications by automating operational best practices in real time, which can lead to reduced operational costs.

Cisco says that Houston-based Tidal software’s solutions will bolster Cisco’s data center strategy “by providing timely, accurate and cost-efficient management and automation of application performance across entire business operations, from the server through the network to the desktop,” the company says in its prepared statement announcing the acquisition.

The Tidal Software acquisition news follows recent moves by Cisco to become more heavily entrenched in the data center space through its Unified Computing initiative.

Cisco says that upon completion of the deal, the Tidal Software team will become part of the Cisco Advanced Services organization. The deal is expected to close in Q4 of Cisco’s fiscal year.