Big data giants Cloudera and Hortonworks announce $5.2 billion merger

The fierce rivalry between the two software companies has now given way to a “a merger of equals.”

Written by Folake Dosu
Published on Oct. 08, 2018
Big data giants Cloudera and Hortonworks announce $5.2 billion merger

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In major news for the business of big data, industry heavyweights Cloudera and Hortonworks recently announced a $5.2 billion merger, Cloud Tech reports.

The fierce rivalry between the two has now given way to a harmonious partnership, “a merger of equals.”

Hortonworks, a publicly owned company since 2014, was cited as a competitor of Cloudera when the latter filed to the SEC. The companies have much in common as their offerings both run on Hadoop, the big data-friendly open source software.

"By bringing together Hortonworks’ investments in end-to-end data management with Cloudera’s investments in data warehousing and machine learning, we will deliver the industry’s first enterprise data cloud from the Edge to AI."

“Our businesses are highly complementary and strategic,” Cloudera CEO Tom Reilly said in a press release. “By bringing together Hortonworks’ investments in end-to-end data management with Cloudera’s investments in data warehousing and machine learning, we will deliver the industry’s first enterprise data cloud from the Edge to AI. This vision will enable our companies to advance our shared commitment to customer success in their pursuit of digital transformation.”

Shareholders hope to reap from the financial benefits and enhanced offerings of the merger, through which leadership plans to establish the industry standard for hybrid cloud data management, accelerating customer adoption, community development and partner engagement.

Per the terms of the transaction agreement, Cloudera stockholders will own approximately 60% of the equity of the combined company and Hortonworks stockholders will own approximately 40%. Cloudera CEO Tom Reilly will be CEO of the combined company while Hortonworks CEO Rob Bearden will join the board of directors, among other executive level changes.

With revenues for the big data and business analytics solutions market set to hit $260 billion by 2022, the Hortonworks and Cloudera pairing is a strategic decision designed to grab as much as market share as possible.

"This is a wonderful merger," Reilly told CNBC. "Basically, bringing these two companies together, we are creating immense shareholder value. So, our plans are that by 2020, just around the corner, our combined company ... will be greater than $1 billion in annual revenues, will be greater than 20 percent year-over-year growth and will have greater than 15 percent operating cash flow margins."

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