Splunk, a global provider of machine learning-based solutions to monitor, investigate and act on all forms of business, IT, security, and IoT data, has announced a definitive agreement to acquire SignalFx – a SaaS leader in real-time monitoring and metrics for cloud infrastructure, microservices and applications.
“Data fuels the modern business, and the acquisition of SignalFx squarely puts Splunk in position as a leader in monitoring and observability at massive scale,” said Doug Merritt, President and CEO of Splunk. “SignalFx will support our continued commitment to giving customers one platform that can monitor the entire enterprise application lifecycle. We are also incredibly impressed by the SignalFx team and leadership, whose expertise and professionalism are a strong addition to the Splunk family.”
Splunk will acquire SignalFx for a total purchase price of approximately $1.05 billion, subject to adjustment, to be paid approximately 60% in cash and 40% in Splunk common stock. The acquisition is expected to close in the second half of fiscal 2020, subject to customary closing conditions and regulatory reviews.
Data Center, Coud-Native
“By joining Splunk, we will create a powerful monitoring platform – one ready to support CIOs whether they have fully embraced cloud or have existing applications in the data center,” said Karthik Rau, Founder and CEO of SignalFx. “As the world continues to move towards complex, cloud-first architectures, Splunk and SignalFx is the new approach needed to monitor and observe cloud-native infrastructure and applications in real time, whether via logs, metrics or tracing. The SignalFx team is thrilled to join Splunk to help CIOs capitalize upon the modern application portfolio.”
The combination of Splunk and SignalFx would give IT and developers a data platform that allows them to monitor and observe data in real time, no matter the infrastructure or data volume, helping them cut costs, boost revenue and improve the customer experience. This enables organizations to work across their entire data landscape, not just silos in the data center or cloud-native environments.
“The strength of our balance sheet allows us to pay the majority of purchase price consideration with cash on hand,” said Jason Child, chief financial officer, Splunk. “Total equity consideration plus initial SignalFx employee retention incentives will result in less than three percent total dilution from this transaction. Post-closing, we expect to absorb the acquired operational expenses of SignalFx within our existing plan. At this time, we are reaffirming our full year non-GAAP operating margin target.”