Security Specialist Infoblox Taken Private in $1.6B Deal
Network control specialist Infoblox is to be acquired for $1.6 billion by Vista Equity Partners after announcing in June plans to cut 12% of its workforce.
Founded in 1999, and taken public in 2012, Infoblox Inc. develops a range of security offerings for managing Internet addresses and ensuring that connected devices can be properly identified.
Vista's offer price represents a 33% premium to Infoblox's average closing price over the last 60 days and comes after several months of speculation about a takeover of the company.
Infoblox's share price has soared from $15.31 on May 11, when reports of takeover interest first surfaced, to $26.25 earlier today.
That represented an increase of 15% on the closing price last Friday, before Vista had announced its offer.
In a statement, Infoblox said Vista's backing would help it "drive DDI automation and DNS [domain name server] security into the enterprise market."
While it managed to increase revenues by 17% in the fiscal year ending in July, Infoblox cited "challenging" conditions in its earnings report and predicted that it would generate between $360 million and $380 million in sales in the next fiscal year.
Clearly, the bottom end of this range implies Infoblox would be looking at virtually no growth in sales.
Infloblox also continues to report losses, although its net loss did narrow to $13.7 million in the recent fiscal year, from $27.1 million in the previous one.
In June, the company revealed plans to cut about 12% of its workforce, or 120 jobs, in an effort to make its business "leaner and more efficient."
Infoblox is reported by Bloomberg to have hired Morgan Stanley in an advisory capacity that same month after receiving a takeover offer from buyout firm Thoma Bravo.
Vista appears to have pounced on Infoblox in the expectation that a move to cloud computing will force companies to rely even more heavily on network automation and security.
"Infoblox is the trusted market leader in DDI solutions, and their strategy and portfolio of secure automated networking solutions make the company uniquely positioned to deliver for its customers," said Brian Sheth, the co-founder and president of Vista Equity Partners, in a statement.
Infoblox expects the deal to be finalized by the end of January next year and says it will maintain its corporate headquarters in Santa Clara and continue to be led by the same executive team following the sale.
— Iain Morris, , News Editor, Light Reading