Cisco announced today that it will acquire network security software company Splunk for $157 per share in cash, for a total transaction value of approximately $28 billion. After the acquisition is completed, Splunk President and CEO Gary Steele will join Cisco's senior leadership team and report to Cisco Chairman and CEO Chuck Robbins.
Founded in 2003 and headquartered in San Francisco, Splunk is a cybersecurity company that helps enterprises monitor and analyze their data to minimize the risk of hackers and resolve some technical issues faster.
Robbins said: "We are excited to bring Cisco and Splunk together. The two companies combined will have the ability to drive the next generation of artificial intelligence (AI)-based security and monitoring. From threat detection and response to threat prediction and prevention, we will help organizations of all sizes be more secure and more resilient."
Splunk President and CEO Gary Steele said: "The merger with Cisco represents the next stage of Splunk's growth journey and will accelerate our mission to help organizations around the world become more resilient while delivering more value to shareholders."
In today's hyperconnected world, data is everywhere and every organization relies on it to run their business and make mission-critical decisions. But the accelerating development and adoption of generative AI, expanding threats, and multi-cloud environments are creating unprecedented complexity for organizations. They need a better way to manage, protect and unlock the true value of their data and maintain digital resilience. Cisco and Splunk will work together to address these challenges.
Cisco said the deal is expected to drive positive cash flow and gross margin growth in the company's first fiscal year, and earnings per share growth (on a non-GAAP basis) in the second year. Additionally, it will accelerate Cisco's revenue and gross margin growth.
The transaction will not affect Cisco's previously announced stock repurchase and dividend plans. The transaction has been unanimously approved by the boards of directors of Cisco and Splunk and is expected to close by the end of the third quarter of 2024.