Jan 31, 2022 - Economy

Elliott and Vista Equity to buy Citrix Systems for $16.5 billion

An illustration showing a digital hand holding $100 bills.

Illustration: Shoshana Gordon/Axios

Elliott Associates and Vista Equity Partners agreed to buy Citrix Systems (Nasdaq: CTXS), a Fort Lauderdale, Fla.-based provider of workplace virtualization software, for around $16.5 billion (including $3.5 billion of assumed debt). The firms then plan to merge Citrix with existing Vista portfolio company TIBCO Software.

Why it matters: This is partially a remote work play, and partially about the buyer believing they can thrive where past management struggled in converting customers from desktop licensees to cloud subscribers.

Details: The buyers will pay $104 per share in cash. That's a significant premium to where Citrix shared traded before reports emerged that Elliott (via its Evergreen Coast Capital affiliate) and Vista were circling, but below their levels for most of 2020 and 2021.

History: This has been a very long play for Elliott, which first took a Citrix stake in 2015 and held a board seat until 2020. It's a bit reminiscent to what it did with Athenahealth, when activism also led to a buyout.

The bottom line: "An agreement with Citrix would cap the biggest-ever month for software deals and follow a rampant year in which private equity firms and strategic buyers chased targets." — Bloomberg

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