As the AppDynamics IPO roadshow hit its home stretch this week, top leaders of the software company were back home in California for final visits with prospective shareholders.
Facing a standing-room audience at the Loews Regency Hotel in downtown San Francisco on Monday, AppDynamics CEO David Wadhwani and CFO Randy Gottfried pitched their story to about 100 investors. Then they hopped on a flight to Los Angeles for morning investor meetings the following day, according to sources familiar with the matter.
Meanwhile, about 40 employees, including founder Jyoti Bansal and some board members, were getting ready to head to New York for the software developer's debut on the Nasdaq Stock Market, slated for Thursday, said the sources, who asked not to be named because details surrounding the IPO were confidential.
Investors were expressing enthusiasm. AppDynamics raised the price range for the IPO on Tuesday and the deal was oversubscribed, the sources said.
Little did the almost 1,200 employees know that the company's board was frantically negotiating a sale to Cisco, an AppDynamics customer and technology partner.
In an effort to beat the clock, Cisco CEO Chuck Robbins had quietly invited Wadwhani to his house to propose an acquisition, according to a blog post from Asheem Chandna, an AppDynamics board member and partner at venture firm Greylock Partners. Cisco lobbed in an acquisition bid, and the two companies came to a handshake agreement on Saturday, according to sources.
It wasn't definitive enough to keep AppDynamics from going forward with the IPO, so the companies agreed to a 72-hour negotiating period, giving Cisco just enough time to finalize an offer before the share sale.
After multiple bids, Cisco said in a press release on Tuesday afternoon that it had agreed to buy AppDynamics for $3.7 billion, marking its biggest acquisition since 2012, when the networking company spent $5 billion on video software maker NDS.