Citrix Systems on Thursday received a letter from shareholder
Elliott Management Corp., which has requested a meeting with the
board to discuss its plans that it says could help the company's
share price increase by about 50%.
Shares in Citrix rose 6% to $69.62 in early trading.
According to Elliott, the firm owns 7.1% of Citrix shares
outstanding, making it one of the business-software's largest
holders. In the letter it made public, Elliott said it believes
Citrix can achieve a stock price of $90 to $100 by the end of next
year.
"Citrix has leading technology franchises in attractive markets
but has struggled operationally for years. As a result, today
Citrix's operations and product portfolio represent an opportunity
for improvement of uniquely significant magnitude," Elliott
wrote.
A Citrix representative wasn't immediately available to
comment.
In January, Citrix announced a restructuring program by which it
cut more than 700 jobs. At the time, the company said it expected
to save $90 million to $100 million.
But Elliott said in the letter that Citrix can be more
efficient, saying its product portfolio is "too broad for its scale
and contains far too many underperforming product lines." Elliott
also said Citrix has "high-value strategic assets that we believe
can be separated" from Citrix's core workspace services
segment.
For its most recent quarter, Citrix reported a 48% drop in
profit as it recorded restructuring-related charges. The company
also cut its outlook for the year and warned that current-quarter
results would disappoint.
Elliott, founded by investor Paul Singer, has pushed for change
at other companies such as data-storage firm EMC and network
equipment companies Juniper Networks and Riverbed Technology, in
addition to ad agency Interpublic Group of Cos.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
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