Citrix Systems, Inc. (NASDAQ:CTXS) Would Make A Great Buy For Dell’s Software Business

There seems to be a few options for Citrix Systems, Inc. (NASDAQ:CTXS) to exit the scene gracefully. However, Dell Inc.  could be a great suitor. Hewlett-Packard Company (NYSE:HPQ) would be another one, but the Meg Whitman-led company is already consumed with its own issues as it is a breakup process.

It is emerging that Citrix Systems, Inc. (NASDAQ:CTXS) is considering selling itself to Dell. Initially, there were reports that Citrix could only sell some of its parts while retaining its position as a standalone company. However, it turns out that Citrix is pondering selling the entire company to a suitable buyer – and Dell is on target.

It doesn’t seem like Citrix is getting any attractive orders from potential buyers and the company is shopping itself to Dell, according to various media reports. Given Dell’s current position and where it wants to go from here, Citrix would be a suitable buy, especially for its software division.

Citrix’s assets

Citrix Systems, Inc. (NASDAQ:CTXS) is known for its technologies that span mobile device management, collaboration and system virtualization. Moreover, the company also has a footprint in cloud computing software. These are areas that Dell would be glad to expand into or deepen presence. For example, Citrix’s GoTo business could add substantial revenue to Dell’s software business in addition to enriching it.

Dell is also looking to bolster its play in mobile and Citrix’s XenMobile could go a long way into giving the company an edge in mobility.

There are a number of Citrix products that can dovetail with Dell’s own products for better results. Dell’s Wyse unit can perfectly tie up with Citrix’s desktop virtualization solutions. In the networking business, Dell’s position could be significantly bolstered by Citrix’s NetScaler.

On the hardware side, Dell could leverage several of Citrix Systems, Inc. (NASDAQ:CTXS)’s products to gain a competitive advantage in the hardware business.

Expensive deal

Despite the potential synergies in a Dell-Citrix Systems, Inc. (NASDAQ:CTXS) merger, the deal could be expensive. Dell would have to fork out more than $11 billion to close the transaction.

Neha Gupta

Neha Gupta has been in the financial space for over six years now. Gupta earned her MBA degree from Symbiosis Centre of Distance Learning in 2009 and her passion for finance led her to pursue Chartered Financial Analyst (CFA) course. She has successfully completed Level II of her CFA. She is a veteran in article writing, which is depicted in her numerous pieces published on SeekingAlpha, Nextiphonenews, InsiderMonkey, MarketWatch, and Techinsider. Her crisp and eloquent writing finds its best place in Researchcows, where emphasis is given on developing rich content for various websites, products, business plans, trainings, and book writing.

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