Elliott Management Offers To Buy Riverbed Technology For About $3.08 Bln.

(RTTNews) - Hedge fund firm Elliott Management Corp., Wednesday offered to buy networking products maker Riverbed Technology Inc. (RVBD) for about $3.08 billion. Following the news, Riverbed shares surged ten percent on the Nasdaq.

Elliot Management in a communique earlier today to Jerry Kennelly, Chief Executive Officer and Chairman of Riverbed, offered to buy the company for $19.00 a share.

Shareholders of Riverbed reacted positively to news sending the stock surging to $19.69, up $1.84 or 10.36%, above the offer price.

The offered price represents a 6 percent premium over Riverbed's Tuesday's closing price, and a 29 percent premium over the unaffected stock price of $14.70 prior to Elliot's significant acquisition of Riverbed's stock.

Activist investing firm Elliot had disclosed in November that the firm and its associates had accumulated a 10.4 percent stake in Riverbed, making it the largest shareholder of the company.

In the letter, Elliot Management hinted that the current offer might increase with the access to private diligence materials, as the current offer is based on publicly disclosed information only.

Elliot also noted that it was ready for other better offers as its filings include a draft merger agreement that contemplates a "go shop" provision that would allow Riverbed's board to solicit competing proposals for a period after agreeing to a deal.

"We are aware that numerous parties have expressed acquisition interest in Riverbed, and this structure guarantees that the Company will secure a healthy premium for its stockholders while holding open the opportunity to obtain an even higher premium," the letter said.