Bloomberg News

Splunk Said to Hire Morgan Stanley to Lead Data Software IPO

January 12, 2012

(Updates with Morgan Stanley ranking in fifth paragraph.)

Jan. 12 (Bloomberg) -- Splunk Inc. hired Morgan Stanley to lead an initial public offering that may value the software maker at about $1 billion, said people familiar with the matter.

JPMorgan Chase & Co., Credit Suisse Group AG and Bank of America Corp. will also work on the IPO, said the people, who declined to be named because talks are private. The filing for Splunk, which plans to raise about $150 million, is imminent, said the people.

Splunk’s programs collect and index data, helping companies evaluate their performance. In July, San Francisco-based Splunk named David Conte as chief financial officer, gaining an executive with experience at a public company.

Paul Wilke, a spokesman for Splunk, declined to comment, as did representatives at Morgan Stanley, JPMorgan, Credit Suisse and Bank of America.

Morgan Stanley was picked to head Splunk’s sale after leading nine U.S. Internet IPOs last year, more than any other underwriter, according to data compiled by Bloomberg. The New York-based bank garnered an estimated $1.3 billion of fees working on initial offerings by Zynga Inc., Groupon Inc., LinkedIn Corp. and Yandex NV, Bloomberg data show.

Analyzing Data

Splunk was founded in 2004 by Erik Swan, Rob Das and Michael Baum. It has won business by helping companies monitor and analyze the data they produce to improve service, cut operations costs and reduce security risks. Splunk has raised $40 million from venture firms August Capital, JK&B Capital, Ignition Partners and Sevin Rosen Funds. The company raised $25 million in 2007 to expand sales and marketing, build its international operations and develop partnerships.

Revenue in the 12-month period ended Oct. 31 almost doubled from a year earlier as Splunk added 350 new paid license customers, including MetLife Inc. and Vodafone Group Plc, the software maker said in November. Splunk said then that its software is used by more than 3,200 companies in more than 75 countries.

Chief Executive Officer Godfrey Sullivan has run Splunk since 2008. He previously led Hyperion Solutions Corp. and helped sell the company for $3.3 billion to Oracle Corp. in 2007. Sullivan replaced co-founder Baum, who is now a partner at investment firm Rembrandt Venture Partners.

--With assistance from Lee Spears in New York and Ari Levy in San Francisco. Editors: Elizabeth Wollman, Nick Turner

To contact the reporter on this story: Serena Saitto in New York at ssaitto@bloomberg.net

To contact the editors responsible for this story: Jennifer Sondag at jsondag@bloomberg.net; Tom Giles at tgiles5@bloomberg.net


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