Nutanix chief executive Dheeraj Pandey nixed speculation that Cisco will soon acquire the data center startup.

DH Kass, Senior Contributing Blogger

May 18, 2015

2 Min Read
Nutanix Boss Stamps Out Cisco Acquisition Rumors

Nutanix chief executive Dheeraj Pandey nixed widely and loudly reported speculation that Cisco (CSCO) soon will make a serious play to acquire the six-year old, red hot San Jose, CA-based data center startup.

Chatter reached a crescendo last Friday when Jared Rinderer, an Equity Capital Research senior research analyst, suggested in a blog post at StorageNewsletter.com that outgoing Cisco boss John Chambers’ is set to make one last grand move before he relinquishes his seat at the networking giant’s helm to Chuck Robbins in July.

“Cisco is actively surveying the battle landscape in the hyperconverged datacenter market,” Rinderer wrote. “Analyzing the hyperconverged systems market, Cisco would gain the most strategic value and long-term accretive revenue contribution with the acquisition of privately-held Nutanix, which is the clear market leader thus far,” he said.

“With a private company valuation exceeding $2 billion as of August 2014, Cisco’s purchase will come at a cost, but Mr. Chambers has always shown a willingness to pay to attain strategic datacenter infrastructure assets,” Rinderer wrote.”

He suggested the deal, which Cisco might finance largely with debt owing to its short U.S. cash position of $3.2 billion, could be announced as soon as early June at Nutanix’s partner conference in Miami.

Nutanix’s Pandey reacted quickly to the rumors, reportedly telling employees it was only a rumor and to ignore it. He followed up on Monday with a statement addressed to “Team Dell,” in which he wrote, “You may have seen recent press speculation of Cisco acquiring Nutanix. There is no truth to those rumors. With the ever-increasing attention on convergence and cloud, we will continue to see press and analysts put forward their guesses on mergers and acquisitions in this space.”

Pandey then went further with his statement, pledging allegiance to Nutanix’s partnership with Dell.

“Nutanix is on the path to become a public company in the not-so-distant future, and has weighed every scenario to chart its course of independence,” he said. “If we ever decide to be part of another company, Dell will have a front-row seat in the bidding for it. That is my word to Michael Dell and a part of our agreement. We don’t want a bidding frenzy because it distracts us from taking care of our customers, our employees and partners like you who are at war…We are also firmly committed to the Dell partnership just as Dell is committed to Nutanix.”

After raising some $140 million in Series E venture funding last August to bring its total backing to $312.2 million, Nutanix’s market capitalization stood at $2 billion.

Deal or no deal, there’s little question that landing Nutanix would fluff up Cisco’s ruffled feathers from its divorce with EMC (EMC) and VMware (VWM) and give Nutanix more heft in its competition with both of those rivals. 

 

Read more about:

MSPs

About the Author(s)

DH Kass

Senior Contributing Blogger, The VAR Guy

Free Newsletters for the Channel
Register for Your Free Newsletter Now

You May Also Like