Cisco Buys AppDynamics for USD 3.7 Billion to Search for Growth

January 24, 2017, Cisco announced that it agreed to buy AppDynamics Inc. for $3.7 billion dollars to expand its core networking business. This is Cisco’s largest deal in the past recent years since it bought the security company Sourcefire for $2.7 billion dollars in 2013.

AppDynamics is a leading software company that manages and analyzes applications. Cisco announced to buy AppDynamics just the day before AppDynamics was set to launch its long-planned IPO.

“The fact that they were in their IPO process represented a window where we needed to make a decision.” Cisco’s Salvagno said.

AppDynamics will become part of Cisco’s Internet of Things (IoT) unit and will be able to provide intelligence from the network through applications said Rowan Trollop, Cisco’s head of IoT and its applications business group.

This acquisition is expected to finish by Cisco’s third quarter of the fiscal year 2017 with a mix of cash and equity. Cisco has been trying to move into the cloud business to increase its competitiveness, I believe this acquisition might bolster their effort in the near future. We look forward to seeing how their future strategy will shift.