The filing showed that Elliott, Elliott International and Elliott International Capital Advisors (EICA) collectively owns 8.6% of the outstanding shares of Citrix Sytems, a provider of virtualization, mobility management, networking, and SaaS solutions to businesses.
The activist hedge fund and its affiliates previously owned 7.5% stake in the company.
Details of Elliott’s investment in Citrix Systems
Elliott beneficially owned 2,380,171 shares or 1.5% of the Citrix Systems. Elliott International and EICA beneficially owned 4,426,373 shares or approximately 2.9% of the outstanding common stock of the company.
Collectively, the firms’ beneficially own 6,706,544 or approximately 4.4% of the outstanding common stock of Citrix Systems. Their combined economic exposure in the company is around 4.2%.
Below are Elliott’s transactions on the stock of Citrix Systems during the past 60 days.
Elliott demands changes at Citrix Systems
In June, Elliott sent a letter to the board of directors of Citrix Systems and demanded fundamental changes in the company due to its underperformance. The activist investor outlined a strategic and operating plan for the company.
According to the activist investor, Citrix System’s stock price could reach as much as $100 + per share by the end of 2016—representing approximately 50% increase in stockholder value.
Elliott’s portfolio manager, Jesse Cohn believed the upside is achievable because Citrix Systems has a leading technology franchises in attractive markets. However, the company struggled for years. The activist investor believed that the company’s operations and product portfolio “represent an opportunity for improvement of uniquely significant magnitude.”
The activist investor suggested that Citrix Systems could spin off its GoTo franchise and NetScaler assets from its core Workspace Services segment.
In July, Citrix Systems CEO Mark Templeton decided to retire, and the company agreed to give a board seat to the activist investor, which in turn agreed to a standstill still on voting and other provisions for at least one year.
The shares of Citrix Systems were trading at $76.63 per share, down by 0.25% at the time of this writing around 1:21 in the afternoon in New York today.
Citrix Systems lost more than 6% of stock value over the past month, but still gained 20% year-to-date. The company’s stock traded between $56.47 and $84.17 per share over the past 52-weeks.