Application acceleration

Thoma, Teachers Fund Win Riverbed's Hand

Riverbed finally has agreed to be married off, but not to the company that had appeared to be its most aggressive suitor.

Riverbed Technology Inc. (Nasdaq: RVBD), which has been under pressure most of this year from activist investor Elliott Management to accept Elliott's buyout offer, instead has agreed to be acquired by private equity firm Thoma Bravo and the Ontario Teachers Pension Plan in a deal worth about $3.6 billion.

In published reports, hedge fund manager Elliott lauded the deal, which values Riverbed at about $21 per share, the same value that Elliott had on its own second buyout offer earlier this year after its first offer of $19 per share was rejected. Elliott owns just under 11% of Riverbed. (See and Riverbed Spurns Takeover Offer.)

Thoma and the OTPP are both seasoned telecom investors. Thoma has been on a SPIT sector tear in recent years years, acquiring or buying major stakes in firms such as Bluecoat Systems, InfoVista and Empirix. (See Blue Coat to Be Acquired, Private Equity Firm Buys InfoVista and Private Equity Firm to Buy Empirix.)

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The OTPP also partnered up with Thoma on the Bluecoat deal announced in late 2011, and has invested in many other telecom firms through its Teachers Private Capital fund, but might be most famous for its role in the attempted acquisition of Bell Canada Enterprises, which ultimately failed. (See BCE Agrees to Buyout.)

Riverbed, best known for application delivery controllers and WAN optimization, came out with a virtual monitoring appliance back in May, but its product moves throughout this year have been overshadowed by the buyout drama and ongoing weak financial performance. In October, the company announced a restructuring program, as well as the intent to review its strategic options.

— Dan O'Shea, Managing Editor, Light Reading

danielcawrey 12/15/2014 | 7:32:22 PM
Re: A deal driven by an activist investor Buyout drama sure doesn't help a company properly compete. But it seems as though Riverbed has some products such as WAN optimization that will help it get by these problems it is having. 
[email protected] 12/15/2014 | 3:55:35 PM
A deal driven by an activist investor Wow -- how much encouragement might this give other activist investors?

A result for Elliott. 
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