Mellanox working with adviser on possible sale

Mellanox working with adviser on possible sale 105531491 1540505228884eyal waldman

REUTERS/Ronen Zvulun

Eyal Waldman, President and CEO of Mellanox Technologies poses for a photograph at the company’s headquarters in Yokneam, in northern Israel July 26, 2016. 

Mellanox Technologies, which makes hardware that helps power supercomputers and Ethernet products used in data centers, has hired a financial adviser to seek a sale after receiving takeover interest from at least two companies, according to people familiar with the matter.

A deal isn’t imminent and may not take place, said the people, who asked not to be named because discussions are private. Talks are still at an early stage, said the people.

Shares rose more than 15% after hours, after the talks were reported.

Mellanox reached an agreement with activist investor Starboard Value LP earlier this year that resulted in the company naming three new independent directors. Starboard had pushed the company to explore a sale after Marvell Technology Group approached the company last year and was rebuffed. Starboard is still the company’s largest investor with a stake of more than 10 percent.

Mellanox has a market capitalization slightly under $4 billion as of Thursday after market close. The company has two corporate headquarters — one in Sunnyvale, California and one in Yokneam, Israel. A Mellanox spokesman couldn’t immediately be reached for comment.

Mellanox specializes in chips and other hardware for data center servers that power cloud computing.

Shares rose more than 10 percent during regular trading Thursday, a day after the company topped earnings estimates, reporting 24% year-over-year revenue growth.

Source : CNBC

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