Shares closed 2.8% above Elliott's offer price. FBR (Market Perform) calls the offer the fist step in a "game of high stakes poker" that will take time to play out, but ultimately reward shareholders. The firm thinks "other strategic and financial buyers" could make bids in the coming months.
Likely on the minds of Riverbed's directors and management: Though Riverbed's shares are up sharply since Elliott's November stake disclosure, they remain well below their 2011 highs.
Their weak performance in recent years - the result of slowing WAN optimization hardware growth and concerns about recently-acquired OPNET's performance - has led Riverbed to sport much lower current and forward price/sales multiples than many networking equipment peers.