US software giants in $5.2bn mega-merger

Newly combined business will have an annual revenue of around $720m

Publicly listed US firms Cloudera and Hortonworks have announced plans to merge, creating an organisation valued at $5.2bn (£3.97bn).

The transaction has been approved by both boards, creating what the pair claims will be "the world's leading next-generation data platform provider".

Tom Reilly, chief executive of Cloudera, said: "Our businesses are highly complementary and strategic.

"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."

The merger will see Cloudera shareholders own around 60 per cent of the new firm, with Hortonworks' owners holding the remaining 40 per cent.

The new firm will have a revenue of around $720m, it claimed, and will save over $125m annual in "cost synergies".

Cloudera CEO Reilly is set to helm the new business, while Hortonworks CEO Rob Bearden will join the board of directors.

Bearden said: "This compelling merger will create value for our respective stockholders and allow customers, partners, employees and the open source community to benefit from the enhanced offerings, larger scale and improved cost competitiveness inherent in this combination.

"Together, we are well positioned to continue growing and competing in the streaming and IoT, data management, data warehousing, machine learning/AI and hybrid cloud markets.

"Importantly, we will be able to offer a broader set of offerings that will enable our customers to capitalise on the value of their data."