US-based wide area network (WAN) optimisation specialist Riverbed Technology has received an unsolicited US$3bn bid from its shareholder Elliott Management.
Elliot, an activist hedge fund that in November disclosed a total 10.4% stake in the group, made…
US-based wide area network (WAN) optimisation specialist Riverbed Technology has received an unsolicited US$3bn bid from its shareholder Elliott Management.
Elliot, an activist hedge fund that in November disclosed a total 10.4% stake in the group, made a US$19 per share in cash proposal for the rest of the company’s outstanding shares, Riverbed announced on 8 January.
As SatelliteFinance went to the press, Riverbed’s share price had soared by nearly 10% to around US$19.53 each.
The hedge fund’s offer represents a premium of 28% over the company’s 60-day volume-weighted average price prior to its latest stake disclosure filing. It was a 6% premium on the market price before the offer, which Elliot believes has been substantially inflated by the significant attention that its stake disclosure generated.
Elliot’s bid includes a “go shop” provision, enabling Riverbed’s board to solicit competing bids over 45 days.
In a letter to Riverbed’s board, Elliot portfolio manager Jesse Cohn said: “With access to private diligence materials, we believe there is a further opportunity to increase our current offer, which is based on publicly disclosed information only.”
The move comes shortly after Riverbed completed a new US$600m bank financing, split between a US$300m senior secured five-year term loan and a US$300m five-year revolver.
JP Morgan, Wells Fargo and HSBC were the lenders, joint lead arrangers and joint bookrunners on the transaction.
Based in San Francisco, Riverbed provides a variety of satellite communication services and is predominantly focussed on satellite WAN optimisation solutions.
