Nutanix Explores Sale After Receiving Takeover Interest

It is far from certain there will be a deal. A buyer would likely have to pay a significant premium to Nutanix’s market value of nearly $5 billion at a time when volatile markets and an uncertain economy have sapped companies’ appetite for M&A and buyout firms’ ability to finance deals.

San Jose, Calif.-based Nutanix specializes in cloud services for businesses, a once-hot area that investors have soured on as pandemic-era demand fades and technology stocks bear the brunt of this year’s market selloff.

Nutanix sported a market value of more than $9 billion in September 2021, but its shares have fallen by more than a third this year through Thursday. They have regained some lost ground lately, soaring after the company reported better-than-expected results and forecasts in late August. They were up more than 19% in early trading Friday following The Wall Street Journal’s report.

In 2020, Bain Capital invested $750 million in Nutanix via convertible senior notes. Two managing directors of the private-equity firm joined the company’s board.

In September, Nutanix announced corporate-governance changes and said it would seek approval for a move to permit shareholders to vote annually for all board directors.

Activist hedge fund Legion Partners Asset Management LLC, which has a less than 1% stake in the company, applauded the changes.

—Laura Cooper contributed to this article.

Write to Dana Cimilluca at [email protected] and Cara Lombardo at [email protected]

Corrections & Amplifications
Legion has a less than 1% stake in Nutanix. An earlier version of this article incorrectly said it had a nearly 7% stake in the company. (Corrected on Oct. 14)