Cisco has revealed its intention to acquire Splunk, a leading force in the cybersecurity and observability platform. The announcement, made today, unveiled a definitive agreement with Cisco acquiring Splunk at an estimated equity value of approximately USD 28 billion.
In a statement, Chuck Robbins, Chair and CEO at Cisco said, “We’re excited to bring Cisco and Splunk together. Our combined capabilities will drive the next generation of AI-enabled security and observability. From threat detection and response to threat prediction and prevention, we will help make organizations of all sizes more secure and resilient.”
Splunk’s President and CEO, Gary Steele, will join Cisco’s Executive Leadership Team following the acquisition.
Under the terms of the agreement, Cisco intends to acquire Splunk for USD 157 per share in cash, representing approximately USD 28 billion in equity value. The transaction is expected to be cash flow positive and gross margin accretive in the first fiscal year post close and non-GAAP EPS accretive in year two. Cisco expects the acquisition to accelerate its revenue growth and gross margin expansion.
But the transaction will not impact Cisco’s previously announced share buyback program or dividend program, the company clarified.
The acquisition is expected to close by the end of the third quarter of calendar year 2024, subject to regulatory approval and other customary closing conditions including approval by Splunk shareholders.