Cisco has announced the completion of its acquisition of cybersecurity firm Splunk. The acquisition, valued at approximately $28 billion, one of the largest in Cisco's history, signifies a strategic move to strengthen its software portfolio amidst the growing interest in artificial intelligence technologies.
The announcement follows just days after the European Union gave Cisco the green light for its acquisition of Splunk without any conditions. This decision came after EU antitrust authorities thoroughly examined the deal and found it did not raise any competition issues.
The acquisition enables Cisco to integrate its networking prowess with Splunk's security and observability solutions, aiming to provide a comprehensive, real-time view of digital landscapes. This unified approach is designed to aid organisations in proactively defending critical infrastructure, preventing outages, and optimising network experiences.
“We are thrilled to officially welcome Splunk to Cisco,” Chuck Robbins, Chair and CEO of Cisco, said highlighting the merger's potential to transform data utilisation for connecting and safeguarding organisational operations, emphasising the role of Cisco in driving and securing the “AI revolution”.
“Uniting Splunk and Cisco will bring tremendous value to our joint customers worldwide,” said Gary Steele, Executive Vice President, General Manager, Splunk.
“The combination of Cisco and Splunk will provide truly comprehensive visibility and insights across an organisation's entire digital footprint, delivering an unprecedented level of resilience through the most extensive and powerful security and observability product portfolio on the market.”
In terms of financial details, the transaction was conducted as a cash purchase, with Cisco acquiring Splunk for $157 per share. The acquisition is expected to be cash flow positive, excluding certain acquisition-related items, and non-GAAP gross margin accretive in Cisco's fiscal year 2025. It is also projected to be non-GAAP EPS accretive in fiscal year 2026 and accelerate Cisco's revenue growth and non-GAAP gross margin expansion.
Following the acquisition's completion, Cisco and Splunk have requested NASDAQ to delist Splunk's common stock, which has ceased trading on NASDAQ prior to the market opening today.
