Elliott and Vista Are Weighing a Joint Bid for Citrix Systems

(Bloomberg) -- Elliott Investment Management and Vista Equity Partners are considering a joint bid for software-maker Citrix Systems Inc., according to people familiar with the matter.

Vista is considering using its portfolio company Tibco as part of the transaction, the people said, asking not to be identified because the matter is private. 

The discussions are in the early stages and Elliott and Vista could still decide not to pursue a bid, the people said.

Citrix has been exploring options including a potential sale, Bloomberg News reported in September. Those considerations came as Elliott took a 10% stake in Citrix, its second time investing in the workplace software maker based in Fort Lauderdale, Florida. 

“Citrix could make its cloud transition more aggressively and with limited public-market scrutiny if Elliott Management and Vista Equity Partners make an acquisition bid,” Bloomberg Intelligence analysts Woo Jin Ho and Mandeep Singh said in a research note Tuesday. 

They added that new management is laying the groundwork to improve sales execution but M&A remains a strategic alternative.

Software deals have been rampant this year with both private equity firms and strategic buyers chasing them. On Monday, Oracle Corp. said it would buy Cerner Corp. for $28.3 billion in its largest deal to date. 

Representatives for Citrix and Tibco didn’t immediately respond to requests for comment. Representatives for Vista and Elliott declined to comment.

Share Reaction

Citrix rose 13% to $94.44 at 9:40 a.m. Tuesday in New York, giving the company a market value of about $11.8 billion. The stock is down 28% in the past year. 

Using Tibco in a merger was also part of Vista’s plan to buy the U.K.’s Blue Prism Group Plc, an offer that was topped by SS&C Technologies Holdings Inc. Vista acquired Tibco, which makes software that helps connect applications, in 2014 for $4.3 billion

Vista has also had some recent dealings with Citrix. Last year, Vista sold one of the companies it was an investor in, Wrike Inc., to Citrix for $2.25 billion. 

Elliott occasionally makes bids for companies in which it’s a public investor. It has been involved with Citrix for several years.

Earlier Campaign

The investment firm and activist investor disclosed a stake in the company in 2015, arguing Citrix was suffering from poor execution and management and needed to simplify its business after a misguided buying spree. As part of a settlement that year, Jesse Cohn, an Elliott partner, joined the Citrix board, where he remained until 2020.

Citrix previously tried to sell itself in 2017 but discussions with potential buyers, including Bain Capital and Thoma Bravo, stalled over valuation, people familiar with the matter said at the time. 

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