Cisco Announces $2.35 Billion Acquisition of Duo Security: Should Close Next Year

Cisco Duo Security acquisition

Announced today was the Cisco Duo Security acquisition. While it may not have been a forecasted acquisition, it is one that makes considerable sense. Here’s why.

Cisco Duo Security Acquisition: Locked and Loaded

On Thursday, Cisco disclosed its intention to purchase Duo Security, an Ann Arbor-based company, for $2.35 billion in cash. In addition, under the terms of the agreement, Cisco will assume equity awards for the security firm.

As long as everything goes as planned, the Cisco Duo Security acquisition is forecasted to close in Q1 2019.

Why Does this Acquisition Make Sense?

Well, both companies will be bringing a lot to the table, especially Duo Security, which has hundreds of employees and offices throughout the US and in London.

With Duo Security comes its security apparatus that lets workers use their personal devices for adaptive authentication. This is something that is going to work well in Cisco’s environment. Further, the technology that Duo Security brings with it is likely to be a natural fit for Cisco, a networking hardware company.

As for Cisco, the company “created the modern IT infrastructure,” said Duo’s CEO, so for the Ann Arbor company, this will only improve their credibility in the industry.

Company Thoughts

According to Duo CEO Dug Song, the Cisco Duo Security acquisition is the result of “the rapid evolution of the IT landscape,” as well as “modernizing workforce.”

This change in the workforce has caused companies to switch how they think about security, explained Song, and this change has led the two companies to come together.

The Stocks React (NASDAQ:CSCO)

Based on how the stock ended the day, I would say investors are optimistic about Cisco’s intent to buy Duo Security.

At closing, Cisco was trading at $42.53, which means it ended Thursday’s session up 1.60%. Sure, the CSCO stock didn’t skyrocket, but gains are gains.

The Takeaway

What do you think about the Cisco Duo Security partnership? Cisco certainly has been making a lot of acquisitions lately (Sourcefire, etc.), but could this one top them all?

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