Akamai Technologies, Inc. the cybersecurity and cloud computing company that powers and protects business online, announced that the U.S. Bankruptcy Court for the District of Delaware has approved its bid to acquire select assets from Edgio, including certain customer contracts from Edgio’s businesses in content delivery and security, and non-exclusive license rights to patents in Edgio’s portfolio. The transaction does not include the acquisition of Edgio personnel, technology, or assets related to the Edgio network.

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The court approval follows Akamai submitting the winning bid for the select assets during Edgio’s 363 bankruptcy auction on November 13, 2024, as part of its filing for Chapter 11 bankruptcy relief. The court decision provides the necessary approval for the closing of the sale to proceed.

When the transaction closes, several hundred net new Akamai customers will have a clear path and the necessary support to smoothly migrate to a best-in-class and reliable provider of the services they need prior to Edgio ceasing operations of its content delivery network. The customers will also have immediate access to the full portfolio of Akamai’s cybersecurity and cloud computing services.

“Akamai is offering Edgio customers a smooth, secure transition without impacting their business or that of their end users,” said Adam Karon, Akamai’s Chief Operating Officer and General Manager, Cloud Technology Group. “We have the capacity, capabilities, and experience to help Edgio customers easily migrate to Akamai, and we believe our track record with similar transactions gives us the expertise to help move them to Akamai as seamlessly as possible. We look forward to welcoming these new customers and giving them the opportunity to take advantage of Akamai’s full range of security and cloud solutions, which run on the world’s most distributed platform.”

For the fourth quarter of 2024, Akamai expects this transaction to add approximately $9-$11 million in revenue. As part of its bid, Akamai agreed to pay certain costs for Edgio to operate its network during the transition and wind-down period until such time as Edgio ceases operation of its content delivery network in mid-January 2025. Akamai expects those transition services costs to be approximately $15-$17 million in the fourth quarter. Akamai anticipates the transaction to be dilutive to non-GAAP net income per diluted share by approximately $0.03-$0.05 in the fourth quarter, inclusive of the transition service costs.

For the full year 2025, Akamai anticipates this transaction will add approximately $80-$100 million in revenue, approximately $25-$30 million of transition service costs, and be accretive to non-GAAP net income per diluted share by approximately $0.15-$0.20.

“We believe this transaction will create significant value for Akamai and our shareholders,” said Ed McGowan, Akamai’s Chief Financial Officer. “By integrating these customers onto our platform with its advantageous cost structure, we expect to improve profitability and unlock new growth opportunities. We’re excited about the potential to cross-sell and up-sell our advanced security and cloud computing solutions to this expanded customer base.”

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Source – Prnewswire