According to Bloomberg News, Elliott Investment Management and Vista Equity Partners have consented to acquire Citrix Systems Inc, the software maker, for a whopping $13 billion, thereby this being the first and biggest leveraged buyout of the year.
The private equity firm of Vista and Elliott, Evergreen Coast Capital Corp is shelling out $104 per share in cash form, as per a statement that was released by the companies Monday, thereby confirming a report earlier by Bloomberg News. This offer is a 30% premium on the company’s closing share price as of December 7th, even before there were speculations about the deal in the market. On December 20th, it was Bloomberg News that reported first about a possible agreement between Elliott and Vista’s potential agreement.
The shares of Citrix were down by about 3.5%, being recorded at $101.8 in the premarket trading scenario on Monday in New York. On Friday, the stock was seen closing at $105.55 and taking the market value of the company to about $13.2 billion.
Citrix, based in Florida, is engaged in making software that workers use when they want to log virtually onto the corporate programs. It is a category of product that is heavily banked upon during the pandemic when workers have to be connected to a main central operation. Since many companies are planning to go the permanent hybrid way with home and office working, the market is slated to grow by using such tools to make the hybrid office working set up seamless, reports Bloomberg News.
As part of the transaction that has been agreed upon, Vista and Evergreen have plans to combine Citrix and Tibco Software. Tibco Software is one of the portfolio companies of Vista and is an enterprise data management company. This combination will give rise to one of the world’s greatest software providers, catering to more than 400,000 customers as per their statement.
Citrix, Elliott Investment Management, and Vista Equity Partners make the months the biggest ever related to software deals. The transaction value in this segment hit a whopping record of $674 billion in 2021, which is approximately double what was in the previous year annually, as per data compiled by Bloomberg News. The values are up 144%, driven by the massive $69 billion Microsoft Corp’s takeover of Activision Blizzard Inc, the video game publisher, as revealed by data.
Bloomberg News also reports that earlier in 2017, Citrix tried to sell itself when discussions with potential buyers that included Thoma Bravo and Bain Capital got stalled due to valuations, as stated by people familiar with the incident at that time.
The considerations for the recent sale popped up when Elliott took a 10% stake in Citrix, the second time investment in the maker of workplace software.
