OPNET Technologies Inc. (NASDAQ: OPNT) shares are finally getting the chance to react to the big news that the company is being acquired by Riverbed Technology Inc. (NASDAQ: RVBD). Riverbed is looking to see if it can add new lines to get its growth and share performance back on track. The deal is a mix of cash and stock, but based on Friday’s closing prices the buyout price was supposed to equate to $43.00 per share.

Riverbed is using its $3.5 billion market cap to acquire the smaller OPNET for its application and network performance management solutions. The deal is said to be for close to $1 billion in enterprise value, which would come to an equity value of $1 billion and an enterprise value of $921 million. The formal terms are for OPNET holders to receive $36.55 in cash per share and 0.2774 shares of Riverbed common stock per OPNET share.

Riverbed will extend its network performance management business into the application performance management market and will move it into the converged market for NPM and APM with over $250 million in annualized revenue. Riverbed expects that the merger will transform it into a company with more than on billion dollars. That figure matters because the Thomson Reuters consensus estimates are $834.75 million and $962.2 million. The consensus estimates for OPNET before the merger news were $198.35 million in this year’s fiscal sales and $228.55 million in next year’s fiscal sales.

Riverbed projected that OPNET is expected to be accretive to Riverbed’s 2013 non-GAAP earnings, with more meaningful revenue and operating synergies in 2014. Riverbed also said that it would finance this acquisition with existing cash on hand and new debt. OPNET’s market cap as of the close of Friday was $741.4 million, but the $32.10 share price compares to a 52-week range of $22.08 to $47.97.

It is fair to ask whether the OPNET shareholders will go without a fight, even if insider ownership and the concentration of a few more large institutional holders can get the deal approved. That might not stop class-action suits, but that is another matter.

OPNET shares closed at $32.10 on Friday, and the indications are for the stock to open around $40.00 or higher against a 52-week trading range of $22.08 to $47.97. Riverbed Technology shares are indicated down more than 2% from the $22.62 close on Friday, and its 52-week range is $13.30 to $30.73.

JON C. OGG

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