Software company Citrix nears $13 billion takeover by Elliott and Vista

Software company Citrix is ​​set to strike a $13 billion deal to be taken private, in what would be the biggest leveraged buyout in months after public tech stocks plummeted.

Citrix is ​​close to a deal to sell to Elliott Management and Vista Equity for $104 a share, according to people briefed on the discussions. The company and Elliott did not respond to emails seeking comment, and Vista declined to comment.

The deal would be one of the biggest technology takeovers on record and end a years-long struggle with Elliott, which began pushing for changes at the company after investing in 2015.

It would also mark the first takeover of 2022 worth more than $10 billion, following a year in which a record $1.1 billion in private equity takeovers was reached, according to the PitchBook data.

Elliott’s Evergreen Coast Capital private equity arm has been involved in some of the biggest deals of the past year, including a $17 billion sale of Athenahealth alongside Veritas Capital to a consortium of buyers investment capital.

Vista, with $86 billion in assets under management, has been one of the private equity industry’s most active investors in software buyouts. The company, led by billionaire Robert Smith, has already announced about nine deals this year, according to data from PitchBook.

Citrix’s software allows employees to work securely from any of their devices remotely, an area that has benefited from increased demand during the coronavirus pandemic.

However, Citrix stumbled in making the transition to remote cloud storage and a subscription-based business model, a common struggle for older tech companies.

David Henshall, former chief executive of Citrix, resigned in October after consecutive quarters of missed sales targets. Citrix board chairman Bob Calderoni, a former chief executive of software company Ariba, replaced Henshall on an interim basis.

Citrix paid about $2.3 billion in cash last year to acquire Wrike, a Vista-backed workplace collaboration software company. In 2017, Citrix sold its GoTo services business to LogMeIn, a company that was taken over by Elliott’s Evergreen Coast branch and buyout firm Francisco Partners for $4.3 billion in August 2020.

The deal would come amid a turbulent time for publicly traded tech companies.

Shares of cloud software companies have fallen by a third in the past three months, according to the BVP Nasdaq Emerging Cloud Index, as U.S. investors fear a cycle of rising interest rates to weather rising l ‘inflation.

Bloomberg first reported in December that Elliott and Vista were considering a joint bid for Citrix. Shares of the company are up more than a quarter since the initial report and traded at $105.55 on Friday.