White (or rather Blue) Knight?

After hedge fund operator Elliott Associates LP set the ball in motion with a $200M buy out bid last month, today's news that someone acquired Packeteer comes as no surprise. What makes it interesting, however, is that it's Blue Coat that came to the table with a $268M cash offer. Assuming Blue Coat does a good job at quickly rolling Packeteer's products into its product line while keeping Packeteer's customers and channel in line, in a couple of years the $268M price tag might look to be a real bargain. All things considered, Packeteer's product offerings are complimentary to Blue Coat's and, in many ways additive. Blue Coat did some interesting financial gymnastics to come up with the cash -- Elliott Associates along with Francisco Partners is fronting $80M in the form of convertible notes.