Citrix Jumps on Report of Joint Bid from Elliott and PE Vista Equity

This post was originally published on this site – Citrix Systems stock (NASDAQ:CTXS) was up 8% in Tuesday’s premarket trade after a Bloomberg report said that activist investor Elliott Management and Vista Equity Partners are considering a joint bid for the company.

Talks are at an early stage and Vista Equity, a private equity focused on tech firms, may use its portfolio company Tibco as part of the bid, according to the report.

Bloomberg had in September reported that Citrix was working with advisers to explore a potential sale. The talks followed Elliott taking a 10% stake in the company. Citrix’s market valuation is currently just over $10 billion.

Elliott is known to chase companies to take steps to increase shareholder returns. This includes moves like reshuffling top management, forcing buybacks, and demands for better capital allocation.

Citrix specialized in remote access software solutions. That specialism was in high demand during the pandemic and looks likely to remain so as work-from-home model takes root. However, the company has meanwhile transitioned to a subscription model, which has capped its revenue growth in the short term.

Third-quarter total revenue of $778 million was up a mere 1% year-over-year. That followed another disappointing quarter when revenue grew 2% year-on-year.

The company’s stock price has suffered, falling 37% in a year when the Nasdaq 100 is up around 23%.