US software company Cohesity has signed a definitive agreement to acquire the data protection business of Veritas.
The move is aimed at establishing a key player in the data security and management sector, valued at an estimated $7bn.
Cohesity and Veritas did not disclose the financial details of the transaction.
However, citing sources, Reuters reported that the deal values the Veritas unit at more than $3bn, including debt.
As per the announcement, the combined entity will offer a portfolio of multi-cloud data protection and manage hundreds of exabytes of data.
It is also expected to benefit from its market presence, with 96 of the Fortune 100 and 80% of the Global 500 companies as clients.
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Additionally, the merger will leverage a partner ecosystem spanning cloud service providers, security firms, system integrators, and hardware original equipment manufacturers.
Sanjay Poonen, the incoming CEO and president of the merged company, will lead the new organisation, while Veritas CEO Greg Hughes will join as a board member and strategic advisor.
The merger is backed by investors such as Softbank Vision Fund, Sequoia Capital, and others.
Upon completion, existing Veritas shareholders, including Carlyle, will become shareholders of Cohesity.
The remaining Veritas businesses not included in the merger will form a new, independent company named DataCo, which will include the InfoScale, Data Compliance, and Backup Exec businesses.
Poonen said: “This deal will combine Cohesity’s speed and innovation with Veritas’ global presence and installed base. We will lead the next era of AI-powered data security and management by bringing together the best of both product portfolios – Cohesity’s scale-out architecture ideally suited for modern workloads and strong Generative AI and security capabilities and Veritas’ broad workload support and significant global footprint, particularly in the Global 500 and large public sector agencies.”
Hughes added: “Bringing Veritas’ differentiated cloud-native architecture to Cohesity’s strong innovation engine will ideally position us to offer our customers transformative solutions against cyber attacks while delivering the flexibility and scalability required to thrive in the multicloud era.”
The transaction, which has received unanimous approval from both Cohesity’s and Veritas’ boards of directors, is expected to close by the end of 2024.