Citrix is acquired by Vista Equity Partners and Elliott Investment Management for $16.5 billion
Citrix Systems Inc., long known for its virtual desktop infrastructure (VDI) solutions, is being acquired for $16.5 billion in an all-cash deal by two technology companies. investment, according to an announcement on Monday.
The buyers are Vista Equity Partners and Elliott Investment Management. Specifically, the subsidiary of Evergreen Coast Capital Corp. d’Elliott is named in the agreement. The investment companies plan to take Fort Lauderdale, Fla.-based Citrix, a private company and combine its efforts with enterprise data management solutions from Vista-owned Tibco.
Citrix plus Tibco
The combined efforts of Citrix and Tibco have been described as accelerating the desktop business as a service (DaaS), as well as hybrid working and “digital transformations”, according to Bob Calderoni, Chairman of the Board of Directors of Citrix and interim CEO and Chairman, in a statement issued:
Together with TIBCO, we will be able to operate at scale and provide a wider customer base with a wider range of solutions to accelerate their digital transformations and enable them to deliver the future of hybrid working. As a private company, we will have increased financial and strategic flexibility to invest in high-growth opportunities, such as DaaS, and accelerate its ongoing cloud transition.
Since Citrix is going private, its fourth quarter 2021 results, as reported on January 31, will be its last such report. Citrix reported positive quarterly revenue of $851 million in Q4 2021, compared to $810 million in Q4 2020. However, there was an overall 1% decline in revenue year-on-year previous ($3.22 billion in 2021 versus $3.24 billion in 2020).
The combination of Citrix and Tibco will create one of the “world’s largest software vendors”, according to Vista and Elliott’s announcement. Exactly how the two software makers’ offerings would be combined was not explained, but the scale of the enterprise market appears to be one of the considerations. They will jointly serve “400,000 customers, including 98% of the Fortune 500, with 100 million users in 100 countries,” the announcement said.
The Citrix purchase is expected to be finalized mid-year, pending approvals from Citrix shareholders and regulators.
Vista markets itself as an asset management company, with a portfolio focused on the high-tech software market. Elliott Investment Management markets itself as a fund manager and asset investment firm focused on “risk management” and “opportunistic trading”. Elliott is best known as a so-called “activist investor” and also a “vulture capital” type business due to its founder, chairman and co-CEO, Paul Singer.
It was Elliot Investment Management that pushed Citrix in 2015 to sell some assets and cut costs, per account. The Wall Street Journal.
Citrix and Microsoft partnership
Citrix, a 33-year-old company, has a strong partnership with Microsoft on VDI solutions. A few years ago, the two companies pledged to renew their loyalty, with Citrix adopting Microsoft Azure services and Microsoft promoting Citrix Workspace as the preferred digital workspace solution.
Microsoft’s foray into VDI services with Azure Virtual Desktop still included Citrix and VMware as key partners to help organizations get VDI working. Later, in August, Microsoft released its Windows 365 DaaS offering, which may have simplified remote desktop access for organizations compared to the Azure Virtual Desktop service.
In particular, Citrix launched its own DaaS offering on Google Cloud Platform in October to support the “hybrid worker” market, becoming a “strategic Google Cloud virtual desktop partner”. The effort was described as an improvement on their years-long collaboration, but Citrix also said at the time that it planned to “build a foundation of their cloud services on Google Cloud.”
Kurt Mackie is senior news producer for 1105 Media’s Converge360 group.