Juniper Networks Cuts Deal With Elliott

NEW YORK (The Deal) -- Juniper Networks (JNPR) announced Friday a restructuring and board overhaul along with plans to return at least $3 billion to shareholders, giving in to demands by activist Elliott Management.

Sunnyvale, Calif.-based Juniper said that it intends to repurchase more than $2 billion worth of shares by the end of the first quarter of 2015 and pay a dividend of 10 cents per share, starting in the third quarter. The company also said that former CEO Kevin Johnson will retire from its board by the end of February, with its board nominating Elliott recommendations Kevin DeNuccio and Gary Daichendt as new directors.

DeNuccio is the former CEO of Redback Networks Inc. Daichendt is a one-time Cisco Systems Inc. executive who also serves on the boards of NCR Corp., Emulex Corp. and ShoreTel Inc. DeNuccio was recently brought in to be CEO of Violin Memory Inc., a company under pressure from some investors to find a buyer.

The capital allocation plan will be funded by a combination of onshore cash and newly issued debt, with Juniper adding that it could return additional funds to shareholders over time, subject to its performance, its economic outlook and other factors.

Juniper will also push a restructuring plan spearheaded by new CEO Shaygan Kheradpir, who stepped into the position shortly before Elliott's January disclosure that it had amassed a 6.2% stake in the enterprise network service provider. Juniper said that it expects to cut annual operating expenses by $160 million in the coming years and achieve an operating margin of 25% by 2015.

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