Forescout to Be Acquired by PE Firm Advent for $33 a Share, or $1.9 Billion

Forescout, a provider of network-access-control technologies, agreed to be bought by the private-equity firm Advent for $33 a share, or $1.9 billion.
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Forescout (FSCT) - Get Report shares jumped after the provider of network-access-control technologies said it definitively agreed to be acquired by private-equity firm Advent International for $33 cash a share, or $1.9 billion.

The purchase price is a 30% upside over the stock’s closing price of $24.45 on Oct. 18. 

That's the day before Corvex Management LP and Jericho Capital Asset Management disclosed that they had partnered to approach Forescout and had accumulated a combined 14.5% ownership in the company.

Forescout shares at last check were 19% higher at $33.40. 

“Forescout has established itself as a leader in device visibility and control,” said CEO Michael DeCesare. 

The San Jose, Calif., company says on its website that its tech "offers the unique ability to see devices the instant they connect to the network, control them, and orchestrate information sharing and operation among disparate security tools."

Included in the Advent acquisition plan is a so-called 30-day go-shop period, ending March 8, which enables the Forescout board to solicit better terms from third parties.

Subject to conditions including regulatory clearances and approval by Forescout's shareholders, the acquisition is expected to close in the second quarter. 

Forescout also reported a fourth-quarter net loss of 9 cents a share on revenue of $91.3 million. Analysts surveyed by FactSet were expecting the company to report a 6-cent loss on $95.2 million of revenue.

The company said that it continued to face “macro and execution challenges” in the Europe-Middle East-Africa region, but that it is taking steps to improve those variables.

“We continue to see strong demand for device control and visibility across all segments of the market,” CEO Michael DeCesare said in a statement.