Showing posts with label Elliot. Show all posts
Showing posts with label Elliot. Show all posts

Sunday, January 21, 2018

Elliott comments on Qualcomm's extended tender for NXP

Elliott Advisors (UK) published an advisory letter to investment funds that now collectively hold an increased economic interest in NXP Semiconductors N.V. of approximately 6.6%. The advisory argues that that NXP is of significant strategic importance to QUALCOMM Incorporated (“Qualcomm”) and that such a transaction will deliver substantial value to Qualcomm shareholders at prices meaningfully higher than Elliott’s own assessment of standalone intrinsic value of $135 per share.

Elliott’s letter sets out the following points:

  • Qualcomm’s shareholders would benefit from a transaction which delivers material diversification away from its declining licensing business and provides meaningful strategic and financial synergies. In Elliott’s view, an acquisition of NXP brings more dollars of strategically relevant diversification in high-growth segments of the semiconductor market to Qualcomm than any other company. Elliott also notes that these benefits would not be available to Qualcomm through other means of capital allocation such as a buyback;
  • The synergies from the acquisition of NXP by Qualcomm alone could create between $19 and $48 of value per NXP share. NXP shareholders would be uniquely disadvantaged if a transaction occurred and these synergies were not appropriately and fairly shared. The average takeover premium paid on semiconductor and large cap deals during the last seven years was, based on one recent estimate, approximately 37%; and
  • The UBS Financial Analysis shows that Qualcomm shareholders could benefit from a share price increase from unaffected levels, as a result of an NXP acquisition, in excess of 30% at prices meaningfully higher than Elliott’s view of NXP’s standalone value of $135 per share.

“We believe both Qualcomm and NXP shareholders stand to benefit from a credible offer for NXP — an offer which appropriately and fairly recognizes both NXP’s intrinsic value, the substantial value that will be delivered to Qualcomm and a control premium for NXP shareholders,” Elliott said in its letter to shareholders. “Even if one’s view of NXP’s intrinsic stand-alone fair value is below Elliott’s own estimate of $135 per share, we believe the analysis supports the finding that Qualcomm can deliver value to its shareholders at prices for NXP higher than $135 per share. Our increasing economic interest in NXP which has current market value of approximately $2.7 billion underscores our significant level of conviction in the value opportunity present at NXP today.”

Wednesday, January 3, 2018

Gigamon's $1.6B privatization deal has been completed

Gigamon confirmed the completion of its acquisition by Elliott Management, a leading multi-strategy private investment firm, and the Qatar Investment Authority.

The acquisition, valued at approximately $1.6 billion, was approved by Gigamon shareholders on December 22, 2017. As a result of the completion of the transaction, shareholders will receive $38.50 per share in cash and Gigamon common stock will no longer be listed for trading on the NYSE.

"This is a pivotal day for Gigamon employees, customers and partners around the world. With the acquisition complete, our team will continue to execute strategic initiatives that will both empower our customers with new, rich functionality and drive Gigamon to the next level of growth," said Paul Hooper, Chief Executive Officer of Gigamon. "As a private company, we will continue to build upon our leading technology foundation and transform the market we created and lead. With our Security Delivery Platform, we are in a unique position to enable NetOps and SecOps teams to work together addressing the common goal of securing their enterprise while containing costs and minimizing complexity. Working closely with Evergreen, we are entering a new and exciting era."

Elliott Management to privatize Gigamon in $1.6 billion deal

Elliott Management, a private investment firm known for shareholder activism, will acquire Gigamon for $38.50 per share in cash, for a total value of approximately $1.6 billion, making Gigamon a privately-held company. Elliott Management and its affiliates currently hold a 7.0% equity voting stake in Gigamon.

Gigamon's recent revenue trends
         2017                        2016
Q3    $79.2 million          $83.5 million
Q2    $69.1 million          $75.1 million
Q1    $69.6 million          $66.9 million

Monday, December 11, 2017

Elliott Advisors says Qualcomm's bid for NXP is too low

Elliott Advisors (UK), which advises funds that collectively hold an economic interest in NXP Semiconductors of approximately 6%, published an open letter stating that Qualcomm's offer to acquire the company is too low. Elliot believes NXP is worth $135 per share on an intrinsic standalone basis – far above the $110 offered by Qualcomm.

Elliott states Qualcomm’s offer of $110 per share is acting as "a ceiling on NXP’s valuation", noting that NXP’s peers have traded up 65% since rumors of Qualcomm’s interest arose.

“We believe NXP’s prospects are bright. Approximately half of NXP’s revenue is exposed to exciting growth engines of the semiconductor market – automotive and industrial,” Elliott stated in its letter to shareholders. “We believe NXP shareholders have the opportunity to unlock a material valuation gap that exists today.”

Qualcomm to Acquire NXP -- Engines for the Connected World

Qualcomm agreed to acquire all of the issued and outstanding shares of NXP for $110.00 per share in cash, representing a total enterprise value of approximately $47 billion. The deal will be financed through cash on hand and $11 billion in new debt. The companies expect total annualized synergies of $500 million within two years of close.

NXP Semiconductors N.V., which headquartered in Eindhoven, Netherlands, employs approximately 45,000 people in more than 35 countries and is known for its mixed-signal semiconductor electronics. The company was known as Philips Semiconductor prior to 2006.

Key markets include automotive, broad-based microcontrollers, secure identification, network processing and RF power. NXP has a broad customer base, serving more than 25,000 customers through its direct sales channel and global network of distribution channel partners.

For Q3 2016, NXP reported revenue of $2.469 billion, up 4.4% over a year ago, and GAAP gross profit of $1.184 billion, up 7.7% over a year ago.

The combined company is expected to have annual revenues of more than $30 billion, serviceable addressable markets of $138 billion in 2020 and leadership positions across mobile, automotive, IoT, security, RF and networking.

Sunday, June 14, 2015

Elliott Sends Letter to Citrix Board of Directors

Elliot Management Corp. published an open letter to the Board of Directors of Citrix, saying it believes the company can achieve a notable increase in shareholder value by implementing a new management plan and undertaking structural reforms.

Elliot currently holds 7.1% of Citrix Systems' stock.

Specifically, Elliot said it believes that Citrix can achieve a stock price of $90 ~ $100+ per share by the end of 2016, which represents a rise of 50%, by improving its operational performance given that it great products in strong markets. One area of concern for Elliot is the company's cost structure, which has grown faster than revenues.

Elliot, which also criticized Citrix's product portfolio as too broad, is presenting a new operating plan for the company.

http://www.elliottmgmt.com

See also