Citrix Systems (CTXS) apparently has hired Goldman Sachs to pursue a potential company sale. according to multiple reports. The company's current market cap: About $12.82 billion. So, which technology companies and investment firms could potentially acquire Citrix? Here's a shortlist of potential suitors.
Updated May 3, 2017, 8:19am ET: At least three private equity firms apparently have bid to acquire Citrix Systems, according to a report.
First, a little background: CEO Kirill Tatarinov (pictured above) has taken key steps to focus Citrix on cloud, mobile, networking and security strategies. Over the past year, he shed the GoTo business lineup while also doubling down on existing relationships (i.e., Microsoft) and new opportunities (i.e., SD-WAN). Generally speaking, channel partners have welcomed the moves.
But is anyone willing to pay roughly $13 billion or more for Citrix? Here's a look at potential business combinations based on ChannelE2E's market coverage. Potential buyers are sorted alphabetically.
1. Cisco Systems: Cisco CEO Chuck Robbins has been pushing hard toward software and recurring revenue services. Cisco also is looking for ways to differentiate its hyperconverged infrastructure (HCI) from that of HP Enterprise (buyer of SympliVity), Nutanix and more. Cisco and Citrix already partner on application and desktop virtualization. Likelihood of buying Citrix: Low to medium. Despite the big potential price tag for Citrix, Cisco could be tempted by all that software revenue...
2. Dell Technologies: The Dell EMC business already controls VMware. Buying Citrix would further strengthen Dell's software story for data centers, mobile, security and more. Likelihood: Low, since we doubt Dell investors have the appetite to take on additional debt after the long-fought effort to acquire EMC.
3. HP Enterprise: CEO Meg Whitman continues to reposition and reshape HPE via spin-offs and acquisitions. Say goodbye to the comnpany's IT services unit, and portions of its legacy software business. Say hello to SimpliVity (HCI) and Nimble Storage (All Flash Array). Likelihood: Low to medium, since Citrix could make a compelling addition to HPE's data center, mobile and security software story.
4. HP Inc.: The PC and printer maker certainly needs to push beyond traditional hardware sales. But here's the thing: HP is managing its business well, and CEO Dion Weisler already has his hands full developing next-generation printer and mobile technologies, while also digesting the Samsung printer business. Likelihood: Low.
5. IBM: CEO Ginni Rometty has focused IBM on strategic priorities like cloud, security, mobile, social and cognitive computing. Citrix aligns with those cloud, security and mobile priorities. But we doubt Rometty has the appetite for such a big deal. Likelihood: Low.
6. Lenovo: The company is pushing hard into midmarket data centers, but technology partners keep getting acquired and Lenovo therefore doesn't control key pieces of the software stack. Citrix could be a compelling fit, but Lenovo already has its hands full with the less-than-stellar buyout of Motorola Mobility. Likelihood: Low.
7. Microsoft: The software giant has partnered with Citrix since the 1990s. Most recently, the duo has partnered closely on Microsoft Azure, where Citrix supports virtual apps, desktops, data and networking. Buying Citrix would give Microsoft a powerful alternative to VMware's various VDI, hosted desktop and mobile offerings. Likelihood: Low to medium. Microsoft tends to prefer rapid growth opportunities. And Satya Nadella doesn't want big M&A distractions (remember Nokia?). But Citrix has a tempting portfolio that aligns with Microsoft.
8. Private Equity: Citrix has a tempting portfolio virtualization, security and mobile technologies. Plus, revenues are growing and Citrix throws off plenty of cash. Likelihood: Medium to high.
9. Telecom Giants: Everyone from AT&T to Verizon is moving toward software-defined networking, SD-WANs and more. Portions of Citrix's technology portfolio address those needs. Likelihood: Low, since telecom giants have been burned by previous software- and cloud-oriented acquisitions that didn't pan out.
10. VMware: Buying Citrix would allow VMware to capture one its main rivals, but can VMware CEO Pat Gelsinger justify the cost for such a move? Likelihood: Low.
Bonus - Other Potential Suitors: Amazon Web Services, Google, Intel, Oracle and SAP also came to mind. There are potential scenarios that may make sense, but most of the potential combinations seemed farfetched to us...
