Citrix Systems Inc. is on the verge of going private again following continued pressure from activist investor Elliott Management Corp.
A Wall Street Journal report said today that Elliott’s private equity firm Evergreen Coast Capital and Vista Equity Partners are close to reaching a $13 billion deal to buy the publicly traded software company. .
The Journal quotes people familiar with the matter as saying a deal could be announced as early as Monday, though talks could still break down or be delayed.
Citrix sells software that allows employees to remotely access business applications and virtual desktops. The company also has a presence in several other parts of the enterprise technology market. For example, it sells a project tracking platform that sales teams use to track outstanding tasks, as well as software tools that help IT departments secure their companies’ business data and optimize network infrastructure. .
Like many legacy software companies, Citrix has struggled to transition to a subscription-based business model and although it has recently seen a boost thanks to the COVID-19 pandemic, investors such as Elliott believe the company continues to underperform.
Elliott felt that for quite a while. The activist investor, who is used to buying large stakes in tech companies and agitating for change to make them more profitable, first bought shares of Citrix in 2015.
He significantly increased his stake in the company last September, spending $1.3 billion to acquire more than 10% of its shares. Since then, Elliott has pushed for a number of changes, which led to David Henshall stepping down as president and CEO of Citrix in October. The company then hired Chairman Bob Calderoni as interim CEO.
The Journal said the market reacted well to the announced takeover, with shares of Citrix closing at $105.55 on Friday.
Elliott, who is best known for his efforts to disrupt the acquisition of EMC Corp. by Dell Technologies Inc. for $67 billion in 2016, acquired a number of other companies in the past after taking a stake in them. The most notable example is Athenahealth Inc., which Elliott and Veritas Capital acquired in 2018. They eventually agreed to sell the business in September.
If the Citrix takeover goes through, the Journal says it will likely be combined with business intelligence firm Tibco Software Inc., which Vista already owns.
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