The acquisition has garnered the endorsement of the boards of both Cisco and Splunk, and it is expected to be finalized by the conclusion of the third quarter in 2024.
Cisco is entering into a $28 billion deal to acquire the cybersecurity firm Splunk. This move is aimed at reinforcing its security measures in anticipation of potential threats, particularly in the context of the growing use of artificial intelligence.
The leading Silicon Valley networking technology giant is poised to acquire Splunk Inc. at a price of $157 per Splunk Inc. share.
Chuck Robbins, who serves as both Chairman and CEO of Cisco, stated in an official release, “Our combined capabilities are poised to drive the next era of AI-enabled security and observability. Spanning from threat detection and response to the anticipation and prevention of threats, we are dedicated to enhancing the security and resilience of organizations, regardless of their size.”
Dan Ives, an analyst at Wedbush, perceives this acquisition as a strategic move for Cisco. He noted in a communication to clients, “Cisco’s concentration on the forthcoming generation of AI-driven security and observability, coupled with Splunk’s esteemed platform, positions this as the right strategic move for Cisco at this moment. It represents a bold move in the cybersecurity arena, conveying a resolute message to industry players such as Palo Alto, Checkpoint, Crowdstrike, Microsoft, Zscaler, and others, that Cisco is actively vying for market share in the years ahead.”
The acquisition has been approved by the boards of both companies and is expected to conclude by the conclusion of the third quarter in 2024. Nevertheless, it is pending approval from Splunk shareholders.
In the early morning trading session on Thursday, Cisco Systems Inc. experienced a drop of nearly 4% in its stock price, whereas Splunk’s shares saw an impressive surge of over 20%.