Carbon Black Stock Officially Ends As VMware Nears Acquisition

VMware completes its tender offer to purchase all outstanding shares of Carbon Black with Carbon Black’s stock now ceasing to exist on the Nasdaq.

VMware is nearing the finish line to complete its acquisition of Carbon Black with the endpoint security star officially ceasing to exist on the Nasdaq stock market as of Tuesday.

The Palo Alto, Calif.-based virtualization superstar unveiled on Tuesday that it has successfully completed its tender offer to purchase all outstanding shares of common stock of Carbon Black for a price of $26 per share, representing a value of $2.6 billion, according to a VMware filing with the U.S. Securities and Exchange Commission.

As a result, shares of Carbon Black officially ceased to be traded on the Nasdaq, effective Oct. 8. The Waltham, Mass.-based security company entered the public market in May 2018, initially trading at around $24 per share. Carbon Black’s stock hit a high of $34.10 per share in June 2018, with a low of $12.27 per share in December 2018.

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VMware said it plans to “promptly complete its acquisition of Carbon Black through consummation of a merger of Calistoga Merger Corp., with and into Carbon Black without a vote of the Carbon Black shareholders.”

Upon completion in the near future, Carbon Black will be a wholly-owned subsidiary of VMware.

VMware is expecting to take the endpoint security market by storm with the acquisition of Carbon Black.

In a recent interview with CRN, VMware’s chief operating officer Sanjay Poonen said VMware will out-innovate “fossils” like Symantec and McAfee.

“In endpoint security, the traditional players are not innovating. They’ve become fossils, almost— Symantec, McAfee,” said Poonen. “Some of them are getting bought by hardware companies, some are getting spun out of hardware companies and put inside private equity companies. What’s happening to that talent, though, is that they’re leaving because the good talent doesn’t want to work for a hardware company or someplace that’s not innovating. … In VMware’s hands, Carbon Black will do better than they are doing on their own because of the distribution presence that we’ll bring to them, the integration possibilities of it, and so much more.”

VMware plans to disrupt the security market as a whole through organic security innovation, leveraging its massive vSphere customer base and by purchasing Carbon Black.

“The traditional endpoint security space has always thought about it as client endpoints—laptops, Windows, Linux—they don’t talk about server endpoints,” said Poonen, who previously held top executive security positions at Symantec and SAP. “We have an incredible advantage in server endpoints. Why? Because we own 70 million VMs with vSphere.”