8-KEarnings & ResultsMaterial AgreementsRegulation FD+1

F5, INC. 8-K Report, Material Agreement (Jan 7, 2021)

Filed January 7, 2021For Securities:FFIV

Summary

F5, Inc. (FFIV) announced on January 7, 2021, its entry into a definitive Merger Agreement to acquire Volterra, Inc. for an aggregate consideration of approximately $500 million. This strategic acquisition involves $440 million in cash and $60 million in deferred consideration, along with the assumption of unvested incentive compensation for Volterra founders and employees. The deal is structured as a merger where Volterra will become a wholly-owned subsidiary of F5. The acquisition aims to bolster F5's capabilities in edge computing and application services. Volterra's technology is expected to enhance F5's security and application delivery networking solutions. The transaction has been approved by the Boards of Directors of both companies and by Volterra shareholders. The closing is anticipated in the first calendar quarter of 2021, subject to customary closing conditions, including regulatory approval.

Key Highlights

  • 1F5 enters into a definitive Merger Agreement to acquire Volterra, Inc.
  • 2Total acquisition consideration is approximately $500 million ($440M cash, $60M deferred consideration and assumed compensation).
  • 3Volterra will become a wholly-owned subsidiary of F5 upon successful merger completion.
  • 4The acquisition is expected to strengthen F5's position in edge computing and application services.
  • 5The deal has received necessary board and shareholder approvals from both companies.
  • 6Expected closing is in the first calendar quarter of 2021, contingent on standard closing conditions.
  • 7A portion of the merger consideration will be placed in escrow to cover potential indemnification and purchase price adjustment obligations.

Frequently Asked Questions

The acquisition of Volterra is intended to enhance F5's capabilities in the rapidly growing edge computing market and bolster its comprehensive application services portfolio. Volterra's technology is expected to complement F5's existing security and application delivery networking solutions, enabling F5 to offer more robust end-to-end services.

The aggregate consideration for the acquisition of Volterra is approximately $500 million. This amount comprises approximately $440 million in cash paid at closing, and approximately $60 million in deferred consideration and assumed unvested incentive compensation for Volterra founders and employees, subject to certain adjustments outlined in the merger agreement.

The merger is expected to close in the first calendar quarter of 2021. The closing is subject to customary conditions, including the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, among other standard closing conditions. There is also a termination date of May 1, 2021, if the merger is not completed by then.

Key risks include the successful integration of Volterra's business and technology into F5's existing operations, potential disruptions to F5's business, the ability of F5's sales channels to effectively sell Volterra's offerings, customer acceptance of the combined solutions, and potential competitive responses. General economic conditions and uncertainties in the IT spending environment also pose risks.