Light Reading

Riverbed Spurns Takeover Offer

Ray Le Maistre

Riverbed has kicked back a $3 billion-plus takeover offer from activist investor Elliott Management, stating that the proposal "undervalues" the application delivery control (ADC) specialist.

The hedge fund, which holds a 10.5% stake in Riverbed Technology Inc. (Nasdaq: RVBD), made its $19 per share offer on January 8 and followed it up with a public letter earlier this week, urging the Riverbed board to consider any takeover offers. (See Riverbed Under Pressure to Sell.)

But following a board meeting, Riverbed announced that it would not consider the offer as it "undervalues the Company and is not in the best interests of shareholders."

Riverbed also announced better than expected preliminary financials for the fourth quarter of 2013, with revenues expected to be in the range of $284 million to $285 million and net income in the range of $0.30 to $0.31 per share.

The vendor also announced that it expects revenues for the first quarter (ending March 31) to be between $262 million and $268 million.

The fourth-quarter numbers and first-quarter outlook "are proof points that our strategy to offer the most complete platform for location-independent computing is beginning to deliver results," stated Chairman and CEO Jerry Kennelly. "As the leading application performance infrastructure provider, we will continue to focus on delivering shareholder value through strong execution.”

That news, as well as the anticipation that an improved takeover offer might be forthcoming (either from Elliott or another suitor), sent Riverbed's share price up to $20.14 in early trading Thursday.

And Kennelly made it clear that he is not averse to acquisition offers at the right price. "While the Board will carefully review any credible offer made to acquire the company, any such offer must deliver value to our shareholders in excess of what we believe will be created as we execute on our growth plans and capitalize on the significant investments we have already made in that regard," he noted in a prepared statement.

— Ray Le Maistre, Editor-in-Chief, Light Reading

(3)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
sam masud
sam masud,
User Rank: Light Sabre
1/17/2014 | 3:00:10 PM
Re: Tech companies M&A are getting driven by non-conventional way!
They seem to be in a pretty stong position financially and customer-wise, so I would not be surprised to see Elliott Management come back with a higher offer. But if would be even more interesting if another vendor were to make an offer for Riverbed.
Vishnu Goel
Vishnu Goel,
User Rank: Light Sabre
1/17/2014 | 4:35:37 AM
Tech companies M&A are getting driven by non-conventional way!
Ray, The current positioning of any telecom company in a M&A market is not driven by the traditional parameters like accretion of cash,geographical access or product complementarity.Nowadays depending upon the target co vision of its own growth through newer inflexion points and disruptive roots determine the future course.Most of the SPIT companies are looking for re-rated valuations by the potential acquirer.Again the core businesses are in the area of Cloud,WAN optimisation,or capex virtualisation.Vishnu Goel T&M +919810101238
User Rank: Blogger
1/16/2014 | 11:49:40 AM
Price still climbing...
Someone's expecting a higher bid... the share price is still creeping up.

Keep in mind that Riverbed is oe of those cmopanies that has a real opportunity to capitalize, or take a hit, from network functions vitrualization. It has obviously been working its way into NFV, thoughm, and has virtualized appliances. Its key partenr currently is Juniper... so that's more than one thing they have in common then as Elliott is also piling the pressure on JNPR!
From The Founder
Steve Saunders provides an overview of white box networking and introduces a new "slim line" version of the OSI 7-layer model.
Flash Poll
Live Streaming Video
CLOUD / MANAGED SERVICES: Prepping Ethernet for the Cloud
Moderator: Ray LeMaistre Panelists: Jeremy Bye, Leonard Sheahan
Telecom Innovators Video Showcase
Service Gateway Virtual Edition

12|1|15   |   8.29   |   (1) comment

Allot's Jay Klein talks to Steve Saunders about its new Service Gateway Virtual Edition.
Wagner’s Ring
The Business Case for Open Source

11|30|15   |     |   (1) comment

Open source helps companies enhance infrastructure, undermine competitors' advantage and teach collaboration. But there are problems.
Between the CEOs
Centec on Ethernet Switching

11|26|15   |   09:58   |   (0) comments

Centec CEO James Sun talks to Steve Saunders about Ethernet switching and the white box revolution.
LRTV Custom TV
Delivering Service Agility in the Virtualization Era

11|25|15   |   5.41   |   (0) comments

Interview with Massimo Fatato, WW OSS Business Lead, Hewlett Packard Enterprise.
Wagner’s Ring
How Might Open Source Fail?

11|24|15   |     |   (10) comments

Open source, SDN, and NFV are looking inevitable – but performance, standards proliferation and regulatory capture could derail the movement.
LRTV Custom TV
NFV Lifecycle Orchestration – a Fresh Vision for Telco

11|23|15   |   6.40   |   (0) comments

Simon Osborne, CTO Comptel, and Heavy Reading's Caroline Chappell reveal the business impacts of new SDN and NFV, and what the term service orchestration actually means. Together they define Lifecycle Service Orchestration and how the virtualized future will look for telecoms operators.
Between the CEOs
Cisco's Virtual Role in Saudi

11|20|15   |   12:15   |   (2) comments

Light Reading founder and CEO Steve Saunders talks with Zayan Sadek, Regional Manager at Cisco Systems, about the competitive communications services market and advance of virtualization in Saudi Arabia.
LRTV Huawei Video Resource Center
Huawei Leads With Kubernetes for Cloud PaaS

11|19|15   |   08:26   |   (0) comments

Huawei is looking to Kubernetes as a key tool for building robust open source technologies for customers and partners, said Ying Xiong, chief architect of cloud platform at Huawei, in an interview with Light Reading West Coast Bureau Chief Mitch Wagner at the recent Kubecon conference.
Women in Comms Introduction Videos
WiC in London: The Highlight Reel

11|19|15   |   5:33   |   (1) comment

NetCracker's Mervat El Dabae headlines an inspiring morning in London with help from leading women from Vodafone, TalkTalk, Hyperoptics and Ciena.
LRTV Documentaries
Why Saudi's So Hot for New Tech

11|19|15   |   05:07   |   (0) comments

Light Reading's Steve Saunders reports from Saudi Arabia, a hyper-competitive market desperate to embrace the next generation of communications technologies and services.
LRTV Custom TV
Why Data Models Deliver More Value Than Information Models

11|19|15   |   5.08   |   (0) comments

Stefan Vallin argues that more automation is needed to manage end-to-end services and the hybrid networks they run on, and that data models are key to achieving this.
Telecom Innovators Video Showcase
SDN Management & Orchestration in the WAN

11|17|15   |   7.20   |   (0) comments

Carol Wilson and Packet Design CTO Cengiz Alaettinoglu discuss CSPs' SDN service delivery and assurance requirements. Learn about a modular approach to building automated control, orchestration and management functions for the WAN that are policy- and analytics-driven.
Hot Topics
Samsung: No Sale of Wireless Unit
Dan Jones, Mobile Editor, 11/25/2015
Facebook in Africa: Beauty or Beast?
Iain Morris, News Editor, 11/27/2015
Cable Gives Thanks for Business Services
Alan Breznick, Cable/Video Practice Leader, 11/27/2015
Hong Kong Moments
Ray Le Maistre, Editor-in-chief, 11/26/2015
How Amazon TV Could Own Christmas
Mari Silbey, Senior Editor, Cable/Video, 11/30/2015
Like Us on Facebook
Twitter Feed
December 15, 2015
Virtualizing Cable Services
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Centec CEO James Sun talks to Steve Saunders about Ethernet switching and the white box revolution.
Light Reading founder and CEO Steve Saunders talks with Zayan Sadek, Regional Manager at Cisco Systems, about the competitive communications services market and advance of virtualization in Saudi Arabia.
Cats with Phones
Live Digital Audio

Broadband speeds are ramping up across Europe as the continent, at its own pace, follows North America towards a gigabit society. But there are many steps to take on the road to gigabit broadband availability and a number of technology options that can meet the various requirements of Europe’s high-speed fixed broadband network operators. During this radio show we will look at some of the catalysts for broadband network investments and examine the menu of technology options on offer, including vectoring and for copper plant evolution and the various deployment possibilities for FTTH/B.