F5 to pay US$500m for edge app platform vendor

F5 Networks has entered a definitive agreement to acquire all issued and outstanding shares of Volterra for approximately US$440 million in cash and approximately US$60 million in deferred consideration and assumed unvested incentive compensation to founders and employees.

With the addition of Volterra's technology platform, F5 is creating an edge platform built for enterprises and service providers that will be security-first and app-driven with unlimited scale.

"Current edge solutions are simply inadequate for today's enterprise customers. It's time to break out of closed edge systems that only perpetuate the pain of building, running, and securing apps," claims F5 CEO and president François Locoh-Donou.

"With Volterra, we advance our Adaptive Applications vision with an Edge 2.0 platform that solves the complex multi-cloud reality enterprise customers confront. Our platform will create a SaaS solution that solves our customers' biggest pain points. The success of F5's software transformation has put us in a position to deliver on the potential of Edge 2.0 and redefine our competitive position.

Volterra enables a new Edge 2.0 open edge platform that will transform F5's leadership position in enterprise application security and delivery, addressing the challenges inherent with first-generation edge solutions.

"I am excited to work closely alongside François and the F5 team to help pioneer the evolution of the edge to deliver more adaptive, dynamic application experiences for all of our customers," says Volterra founder and CEO Ankur Singla.

"With our platform, we will extend F5's application security leadership to the edge, thereby expanding our combined reach in the fastest-growing segment of F5's $28 billion 2023 total addressable market.

F5's Edge 2.0 platform will be:

• Security-first: Delivering industry-leading security instead of commodity security added to a CDN or cloud.
• App-driven: Providing universal, "build once, deploy globally" app delivery. This software-defined edge based on industry-standard containers and APIs removes multi-cloud complexity.
• Unlimited in scale: Edge 2.0 breaks apps out of the "CDN jail" of closed edge platforms, running all services on any server, across all clouds and data centers.

The boards of directors of both F5 and Volterra have approved the transaction, which is subject to regulatory approvals and other customary closing conditions.

The transaction is expected to close in the first quarter of the calendar year 2021.

Upon closing of the transaction, Ankur Singla, and the Volterra leadership team will join F5 in key management roles.

Volterra will remain located in its current Santa Clara headquarters.

"We are on track to deliver our best quarterly results since we embarked on our transformation, with approximately 10% revenue growth fueled by continued strong software demand along with resilience in our systems business," adds Locoh-Donou.