Cisco and Splunk Have Discussed Acquisition Deal

Cisco Systems, a technology group, has been discussing the purchase with software company Splink, although no deal is currently on the table, two people familiar with the matter told The New York Times on Friday.

A deal may not happen at all, but if negotiations resume, Cisco could pay more than $ 20 billion for Splink, one person said.

Splink, whose share price has fallen 30 percent since its chief executive, Doug Merritt, resigned unexpectedly in November, has a market capitalization of about $ 18 billion. Cisco has a market capitalization of $ 227 billion.

People requested anonymity because the information is confidential. Cisco did not immediately respond to a request for comment, while a spokesman for Splank said the company had not commented on the rumors or speculation. The Wall Street Journal reported the potential deal earlier on Friday.

Splunk – named after the name of Splunking, a game of cave exploration – mining data for insights, including security threats, a business that grew significantly as the coronavirus epidemic quickly forced many workers online. He has recently turned to cloud computing and tried to meet his competitors, such as Datadog, who have started their business in the cloud. In June, private-equity firm Silver Lake invested 1 billion in Splank to help with that transition.

Cisco is known as a serial acquirer, effectively using acquisitions as a complement to research and development. Its past deals include Acacia, the maker of optical network components; Luxtera, a semiconductor company; And ThousandEyes, a cloud intelligence company. Its chief executive, Chuck Robbins, told analysts in December that Cisco would continue to seek acquisitions in security.

Technology has been the focus of mergers and acquisitions for the past one year, as rising share prices have helped companies raise cash. Microsoft said last month that it plans to acquire video game company Activision Blizzard for about $ 70 billion, and Salesforce acquired workplace software company Slack for $ 27.7 billion last year.

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