Cisco falls after $28 bln deal for Splunk

Splunk

21/09/2023 16:12

(Updates milestone, additional info)
    ** Shares of networking equipment maker Cisco Systems
 CSCO.O  fall 4% to $53.28 following a deal to buy data
analytics software firm Splunk  SPLK.O  for about $28 bln 
    ** SPLK shares hit over one-year high, last up 21.1% at
$144.81 
    ** CSCO offers $157/share in cash, a premium of about 31% to
Splunk's closing price on Wednesday
    ** Transaction expected to close by the end of Q3 2024
    ** Deal expected to be cash flow positive and add to gross
margin in first fiscal year post close, and non-GAAP EPS
accretive in year two
    ** Deal to add $4 bln in annual recurring revenue- Cisco CEO
Chuck Robbins
        ** If the deal is shelved, Cisco to pay a termination
fee of $1.48 bln
  
    ** Ten of 26 brokerages rate Cisco "buy" or higher, 15
"hold" and one "sell"; their median PT is $58.50
    ** Up to Wednesday's close, CSCO had risen 16.5% YTD

 (Reporting by Khushi Singh)
 ((Khushi.Singh@thomsonreuters.com;))