Cisco Makes Bid For US$20 Billion Splunk Acquisition

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Cisco Makes Bid For US$20 Billion Splunk Acquisition


Cisco Systems Inc. has been in discussions with software company Splunk for the proposed acquisition. Meanwhile, Cisco is reportedly willing to pay more than US $ 20 billion to acquire Splunk.

According to The New York Times, Splunk has a market capitalization of around $18 billion, after its share price has fallen 30% since its chief executive, Doug Merritt, unexpectedly stepped down in November. On the other hand, Cisco's market capitalization has now reached US$ 227 billion.

Cisco did not immediately respond to a request for comment, while a Splunk spokesman said the company does not comment on rumors or speculation.

For your information, Splunk is a company that mines data for insights, including security threats, a business that is increasingly important as the coronavirus pandemic is rapidly forcing many workers online.

Recently, the company has also been trying to move into the cloud business and catch up with its competitors, such as Datadog, who started the cloud business.

In June, private equity firm Silver Lake invested $1 billion in Splunk to help with the transition.

Meanwhile, Cisco is known as an acquirer that effectively uses acquisitions as a complement to research and development.

Cisco's previous successful deals include Acacia, a maker of optical networking components; Luxtera, a semiconductor company; and ThousandEyes, a cloud intelligence company.

Cisco Chief Executive Chuck Robbins told analysts in December that Cisco would continue to seek acquisitions in the security area.

As is well known, technology has become a hotbed of merger and acquisition activity over the past year, as soaring stock prices have flooded companies with cash.

Meanwhile, Microsoft last month said it plans to acquire video game company Activision Blizzard for nearly $70 billion, and Salesforce acquired workplace software company Slack last year for $27.7 billion.


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