Cohesity completed its long-awaited merger with Veritas’ enterprise data protection business. The combined entity, valued at $7 billion, now serves 12,000 customers globally and generates $1.5 billion in ARR.
Deal Details
Initially announced in February 2024, the merger valued Veritas’ data protection business at about $3 billion. Notably, this deal only includes Veritas’ data protection division, leaving the rest of the company untouched and under Carlyle’s ownership.
The leadership team will comprise executives from both Cohesity and Veritas, alongside external hires, to ensure a seamless integration of operations and strategy. Products from both companies, including Veritas NetBackup and Cohesity’s portfolio, will continue to receive investment and development resources.
Arctera Spin-Off
As part of the merger, Veritas spun off three of its business lines—InfoScale, Backup Exec, and its Data Compliance and Governance group—into a new company named Arctera. Arctera will be an independent private entity under Carlyle Group’s ownership, led by former Veritas executive Lawrence Wong.
This spin-off ensures that these SMB-focused products receive dedicated resources and strategic oversight, allowing them to grow without being overshadowed by Veritas’ enterprise-centric priorities.
Arctera’s structure includes separate business units for each product line, enabling focused development and marketing efforts. InfoScale addresses high availability for hybrid cloud environments, Backup Exec offers backup solutions for SMBs and hybrid environments, and the Data Compliance and Governance group provides visibility, security, and compliance tools.
Analysis
The consolidation of the two companies highlights the growing importance of unified data protection solutions. Enterprises want integrated platforms to efficiently manage backup, recovery, and compliance requirements. Cohesity meets this need by merging with Veritas, setting itself up as a market leader.
Arctera, meanwhile, serves a complementary role by focusing on SMBs and on-premises solutions. Products like Backup Exec and InfoScale, previously overshadowed by Veritas’ enterprise priorities, can now thrive as standalone offerings. This specialization ensures that distinct market segments receive tailored solutions and support.
The new entity’s scale and resources position it to compete more effectively with larger players such as Dell Technologies, IBM, and Rubrik. With Veritas’ global footprint and Cohesity’s innovation-driven approach, the company can offer a comprehensive portfolio tailored to diverse customer needs.
Overall, the merger of Cohesity and Veritas nicely combines the strengths of two established players, creating a powerful entity capable of addressing enterprise challenges at scale. While the move enhances Cohesity’s business prospects and competitiveness, its broader impact will depend on how effectively the new company executes its integration strategy and delivers on its promises to customers.
