F5 Networks and NGINX, an open source leader in application delivery, announced a definitive agreement under which F5 will acquire all issued and outstanding shares of privately held NGINX for a total enterprise value of approximately $670 million, subject to certain adjustments.
Highlights of F5 acquisition of NGINX
- F5 Networks announces the acquisition of NGINX, an open source leader in application delivery.
- Strategic acquisition and organic investment to secure long-term revenue and EPS growth.
- Together, F5 and NGINX will enable multi-cloud application services across all environments, providing ease-of-use and flexibility developers require while also delivering the scale, security, reliability and enterprise readiness network operations teams demand.
- F5 is committed to increasing investment in the NGINX open source project to empower NGINX’s widespread user communities.
- F5 will maintain the brand with current NGINX CEO, Gus Robertson, and founders, Igor Sysoev and Maxim Konovalov, joining F5 to continue to lead NGINX.
François Locoh-Donou, President & CEO of F5, said that the acquisition of NGINX strengthens F5's growth trajectory by accelerating their software and multi-cloud transformation. "By bringing F5’s application security and application services portfolio for improving performance, availability, and management together with NGINX’s leading software application delivery and API management solutions, unparalleled credibility and brand recognition in the DevOps community, and massive open source user base, we bridge the divide between NetOps and DevOps with consistent application services across an enterprise’s multi-cloud environment. We believe every organization can benefit from the agility and flexibility enabled by modern technologies without compromising on security, manageability, and reliability. The combined company will enable every customer—from the app developer to the network engineer to the security specialist—with the tools they need to ensure their apps are available and secure across every platform, from the enterprise data center to private and public clouds.”
NGINX load balancing accelerates F5's time to market of application services
F5 will enhance NGINX’s current offerings with F5 security solutions and will integrate F5 cloud-native innovations with NGINX’s software load balancing technology, accelerating F5’s time to market of application services for modern, containerized applications. F5 will also leverage its global sales force, channel infrastructure, and partner ecosystem to scale NGINX selling opportunities to the enterprise.
“NGINX and F5 share the same mission and vision. We both believe applications are at the heart of driving digital transformation. And we both believe that an end-to-end application infrastructure—one that spans from code to customer—is needed to deliver apps across a multi-cloud environment,” said Gus Robertson, CEO of NGINX, Inc. “I’m excited to continue this journey by adding the power of NGINX’s open source innovation to F5’s ADC leadership and enterprise reach. F5 gains depth with solutions designed for DevOps, while NGINX gains breadth with access to tens of thousands of customers and partners.”
In its press release F5 states that 'NGINX’s open source community was one of the most attractive elements of this combination, and F5 recognizes the trust that the user community has in NGINX’s technology'. Open source is a central part of F5’s multi-cloud strategy and a driver for F5’s next phase of innovation. As such, F5 is committed to continued innovation and increasing investment in the NGINX open source project to empower NGINX’s widespread user communities. F5 expects the combination with NGINX will accelerate its product integrations with leading open source projects and will enhance its strong technology partnerships with open source vendors.
Upon closing of the acquisition, F5 will maintain the NGINX brand. Gus Robertson, along with NGINX founders Igor Sysoev and Maxim Konovalov, will join F5 and will continue to lead NGINX. Robertson will join F5’s senior management team, reporting to François Locoh-Donou. F5 will maintain NGINX’s operations in San Francisco, California and other locations globally.
F5 + NGINX
In a blog post François Locoh-Donou shared a copy of the email he sent to F5's global staff announcing F5’s agreement to acquire NGINX. He mentions the factors that 'excite him most about the F5-NGINX combination:
- Team: "From the very start of this discussion with NGINX, the F5 and NGINX teams spoke the same language – applications. When the NGINX leadership team shared how the company had evolved from open source project to VC-backed start-up, one that now has over 375 million websites running their technology worldwide, it echoed many of the stories I had heard about F5’s early days. And just like the F5ers I know today, it is evident NGINX employees choose speed, that they are owners, they are obsessed with their customers, they are building an inclusive culture, and they help each other thrive. That’s why it has been so critical to this agreement that the team, including CEO Gus Robertson, and founders Igor Sysoev and Maxim Konovalov, will continue to drive NGINX, within F5. I am in San Francisco now to join the NGINX team for an All-Hands this afternoon and celebration later this evening, and I feel fortunate to have this opportunity to start to get to know more of our new colleagues."
- Strategy: "That “one team” approach is underscored by the fact both companies share the same outlook on the software growth opportunities for application services. We may talk to NetOps and they may be the choice of DevOps, but both of our customers are trying to bridge the divide between traditional and modern applications, across multi-cloud environments — to balance enough effective controls with enough freedom to innovate. We believe that a combined F5-NGINX will significantly accelerate our growth strategy by serving customers with enterprise-grade services for all applications, traditional and modern, wherever they are built or deployed."
- Portfolio and technology: "The reason we believe so strongly in this strategy is because of our complementary strengths. NGINX excels as the trusted open source leader in web and application server technology, providing cloud-native support for container-based microservices environments and new application services such as API Management for today’s API-first applications. F5 brings the broadest product portfolio of application services that ensures every application is optimized and secure across the enterprise for over 25,000 loyal customers around the world. Together, F5 and NGINX will bridge the gap from applications to infrastructure and from developer to operations."
- Customers, Partners, Community: "We believe that with our combined F5-NGINX solutions, our customers – from the app developer to the network engineer to the security specialist – will for the first time benefit from the agility and flexibility enabled by modern technologies, without compromising on the time-tested fundamentals of security, manageability and reliability. But it cannot be done without a clear and unequivocal commitment to the open source innovation that has powered NGINX to date. We must steward this thriving open source and developer community in good faith. So, let me make sure there is no confusion on this point: F5 is 100% committed to the continued innovation and increasing investment in the NGINX open source project."
The acquisition has been approved by the boards of directors of both F5 Networks and NGINX and, following execution of the definitive agreement, received the requisite shareholder approval of NGINX. It is subject to regulatory approvals and other customary closing conditions and is expected to close in the second calendar quarter of 2019.
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12 March 2019