Cisco closed the deal to buy Splunk for $28 billion

Cisco closed the deal to buy Splunk for $28 billion

Cisco has announced the closing of a deal to acquire data analytics platform developer Splunk. In September 2023, the parties agreed to buy back the shares at $157 each. This is a third higher than their stock price. The total amount of the deal was $28 billion, which is the largest purchase for Cisco in 19 years. The largest deal was considered to be in 2005, when the company bought cable and satellite TV equipment manufacturer Scientific Atlanta for $7 billion.

Splunk is a platform for collecting information generated by the technological infrastructure of enterprises. The platform can detect cyber attacks and find the causes of technical problems such as equipment malfunctions. Slunk is used by 15 thousand organizations.

As part of the acquisition, Splunk will be integrated with Cisco’s Talos division, which collects threat intelligence. Cisco said in a blog post that Talos data will be made available to the Splunk platform, and Splunk and SOAR SIEM solutions will be augmented with cloud, network and endpoint data.

The purchase of Splunk and subsequent integration of the platform into Cisco solutions should create a universal user interface through which data from various sources can be applied to map cyber threats and predict other risks.

Cisco was going to buy the Splunk platform back in February 2022. At that time, the vendor offered $20 billion for the platform. And almost 2 years later, the amount increased to $28 billion.

Cisco estimates that the Splunk purchase will add $4 billion to the company’s annual recurring revenue and be accretive to adjusted gross profit through fiscal 2025 and accretive to adjusted earnings per share next fiscal year. Against the background of the purchase, Cisco has cut staff by 5% (4,250 employees) as part of the so-called restructuring or cost optimization.

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