Riverbed goes private in $3.6 billion deal

Riverbed Technology is the latest major tech company to bow out of public trading, announcing a $3.6 billion takeover by private equity firm Thoma Bravo on Monday. The price is the highest ever paid by Thoma Bravo, and works out to $21 for each share of Riverbed currently in circulation.

The deal should close in early 2015, pending regulatory and shareholder approval. With those in hand, Riverbed would join a growing list of high-profile tech companies in going private, including Dell, BMC and Blue Coat.

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Riverbed is best known for its WAN optimization hardware, an area in which the company has been consistently recognized for quality. Its recent history, however, is one of diversification, purchasing companies with related product offerings and rolling out new lines of its own.

The company had been an acquisition target for some time, rejecting a January bid by Elliot Management Corporation for around $19 per share, and a subsequently sweetened offer of $21 per share. But it had also made acquisitions of its own, most notably the billion-dollar purchase of application performance management company Opnet Technologies in 2012.

While Riverbed’s fortunes had been generally improving over the past few months, it’s still a company facing plenty of challenges. Riverbed lost more than $12 million in 2013, and although it returned to profitability over the past year, some experts believe the company has had trouble integrating Opnet, its big buy.

Moreover, Riverbed is embroiled in a legal battle with rival Silver Peak, which has accused Riverbed of copying its technology. The latest round went to Silver Peak in September, as a federal judge upheld an infringement finding against Riverbed.

The WAN optimization giant has been publicly traded on the NASDAQ since 2006. Shares of its stock reached their peak value in March 2011, at $44.48, but Riverbed has hovered within $2 of $20 for most of the last year.

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