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The transaction is valued at approximately $28 billion.
Cisco stock fell 4.8% on the announcement. Splunk shares were halted pending news.
Following the completion of the acquisition, Gary Steele, President, and CEO of Splunk, will join Cisco’s Executive Leadership Team and report to Chair and CEO Chuck Robbins.
“We’re excited to bring Cisco and Splunk together. Our combined capabilities will drive the next generation of AI-enabled security and observability,” said Chuck Robbins, chair and CEO of Cisco.
“From threat detection and response to threat prediction and prevention, we will help make organizations of all sizes more secure and resilient.”
The transaction is expected to close by the end of the third quarter of calendar year 2024. Cisco said that the acquisition is anticipated to have a positive impact on cash flow and gross margin in the first fiscal year after closing, with non-GAAP earnings per share (EPS) becoming accretive in the second year.
Furthermore, it is expected to enhance Cisco’s revenue growth and gross margin expansion.
