Cisco acquires AppDynamics Inc for $3.7 billion

It has recently been announced that technology giant Cisco has acquired start-up AppDynamics for $3.7 billion, replacing the companies aim to sell shares externally. Situated in San Francisco, AppDynamics has proved highly beneficial for companies who wish to develop their current strategies and application performance, specialising in cloud applications and business monitoring through mobile and website applications.

David Wadhwani, AppDynamics CEO and President said, “AppDynamics is empowering companies to build and successfully run the applications they need to compete in today's digital world."

"With digital transformation, companies must re-define their relationships with customers through software. We're excited to join Cisco, as it will enable us to help more companies around the globe."

With the aim to enable businesses to have a closer look at the effectiveness of their applications and tackle any concerns with regards to performance, AppDynamics will prove a worthwhile acquisition for Cisco, who have been behind several acquisitions, highlighting their move towards networking, cloud technologies and digital applications. These acquisitions will support Cisco’s business model and evolution towards providing key solutions against modern business requirements, with such technological innovations proving advantageous.

Hilton Romanski, Cisco’s Head of Corporate Strategy informed Bloomberg, “It is important for Cisco to have market-leading software in our portfolio to deliver on this journey that we’ve been on for some time. This asset is best in class. We believe this is one of the best teams out there to help us on our journey.”

Wadhwani will remain part of the senior team and become part of Cisco’s Internet of Things (IoT) and Applications business, working effectively under Rowan Trollope, Cisco’s Senior Vice President and General Manager of Cisco's IoT and Applications Business Group. With the announcement of the acquisition, Trollope commented: "Applications have become the lifeblood of a company's success. Keeping those apps running and performing well has never been more important. Unfortunately, that job has only gotten harder, as IT departments and developers struggle with a tangled web of disconnected, complex data that's hard to understand.”

"The combination of Cisco and AppDynamics will allow us to provide end to end visibility and intelligence from the network through to the application; which, combined with security and scale, and help IT to drive a new level of business results."

Investors in the business will benefit significantly from the acquisition, but it is no doubt small change to Cisco, of which their revenue was $49.24 billion in 2016 alone. The deal is likely to finalise by the end of September.

Follow @BizReviewUSA and @NellWalkerMG

Read the January issue of Business Review USA & Canada here