Cisco Systems is said to have been knocked back in a $7 billion-plus buyout offer for cloud monitoring software firm Datadog prior to its IPO this week.
The startup rejected the proposed takeover to pursue a stock listing as it felt it "could be worth more as a public company over time", according to sources familiar with the matter speaking to Bloomberg.
Cisco declined to comment on the bid but talks between the two businesses were "no longer active", the anonymous sources revealed at the time, due to Datadog remaining steadfast in its IPO intentions.
Datadog raised $648 million in its US IPO on Wednesday, thanks to the sale of 24 million shares at $27 each, having marketed them at $24 to $26. The listing valued the software business at $7.83 billion, Bloomberg said.
Through its SaaS-based data analytics platform, Datadog offers the monitoring of servers, databases, tools and services for cloud-scale applications and currently counts Twitter, Biogen, Deloitte and Comcast amongst its customers.
Prior to its IPO, Datadog had raised $147.9 million in investments, with its 2016 Series D funding round garnering $94.5 million. According to its recent S-1, the company also revealed it had upwards of 8,800 customers and achieved a revenue increase from $100.8 million in 2017 to $198.1 million in 2018, Silicon Republic noted.
The firm's platform directly competes with Cisco's own AppDynamics, which it successfully purchased for $3.7 billion just before the analytics business went public back in 2017.
The software firm has also made a number of other acquisitions in recent times, including security platform Duo Security for $2.35 billion back in 2018.
Bloomberg pointed out that software companies that power business processes have delivered some of the 2019's best IPO debuts thanks to high margins and solid revenue. Both Zoom Video Communications and Crowdstrike Holdings have doubled in value since they began trading this year, placing them among the ten best performing offerings, according to data compiled by the news outlet.
