In a significant move in the data protection industry, Cohesity has completed its merger with Veritas’ enterprise data protection business. The combined entity, valued at $7 billion, boasts an impressive 12,000 customers and an annual recurring revenue of $1.5 billion.
Deal Details
The deal was first announced in February 2024, with Cohesity valuing Veritas’ data protection business at $3 billion. However, the exact price paid by Cohesity remains undisclosed. The merger transaction was funded by a Series H round led by Haveli Investments, with participation from Coatue, Sapphire Ventures, and Dragon Fund among others.
Background on the Deal
Cohesity CEO and President Sanjay Poonen revealed that when he joined the company in August 2022, one of his first priorities was to survey executives at other data protection companies. The feedback he received highlighted the industry’s fragmentation and the need for consolidation. Veritas’ data protection business stood out as a potential acquisition target due to its focus on enterprises and differentiated customer base.
Consolidation and Synergies
Poonen emphasized that the primary goal of this merger is to create more value for customers by combining Cohesity’s products with Veritas’ offerings, including NetBackup, NetBackup appliances, and Alta data protection. The combined entity will continue to invest in both sides of the business, ensuring a seamless integration of products.
Market Impact
While the deal brings together two significant players in the data protection industry, it may lead to higher prices due to reduced competition. However, Cohesity has stated that there are no plans to change pricing or customer contracts.
Benefits for Customers
- Unified Product Portfolio: The combined entity will offer a more comprehensive product portfolio, providing customers with a one-stop solution for their data protection needs.
- Increased Innovation: By leveraging the strengths of both companies, Cohesity and Veritas will accelerate innovation in the data protection space.
- Enhanced Support: Customers can expect improved support and service from the combined entity, with a greater focus on customer satisfaction.
Industry Reaction
The merger has been met with interest and skepticism within the industry. Some analysts view this as a strategic move to create a more formidable player in the market, while others worry about potential job losses and changes in pricing strategies.
Future Plans
Cohesity’s CEO, Sanjay Poonen, expressed confidence in the company’s ability to integrate Veritas’ data protection business and drive growth. The combined entity is expected to expand its customer base, increase revenue, and solidify its position as a leader in the data protection industry.
Conclusion
The merger between Cohesity and Veritas’ enterprise data protection business marks a significant development in the data protection industry. As the combined entity looks to create more value for customers through innovation and consolidation, investors and analysts will be closely watching its performance.
