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Juniper may be for sale, but not to EMC

Jim Duffy | Oct. 19, 2012
Wall Street doesn't doubt that Juniper Networks is in play, but does doubt EMC's interest in the company.

"To the extent EMC is looking at entering the switching market, it would be centered upon next-generation architectures - flat (single tier) networks, NOT competing head-head in a well-established legacy 3-tier network dominated by Cisco," Mansky states. "Juniper's Q-Fabric offering, its next-generation 'flat network' architecture has ~200 customers after almost two years in the market - and was just the focus of the down-sizing action taken at Juniper; Brocade on the other hand has over 700 customers in the same amount of time."

Citigroup doesn't believe Juniper is shopping itself around at all, according to this Barron's post:

"Simply put, we don't think the set-up is ripe for a company-driven sale: JNPR has major product cycles just kicking in (T4000 core router upgrade, PTX converged transport solution, QFabric data center solution), still-healthy margins (down significantly from 2010 levels, but a still-healthy 15% operating margin last quarter), solid cash flows ($212mln CFO, $124mln FCF last quarter), and healthy balance sheet ($3.4bln cash & ST investment, $2.4bln net cash). We don't see JNPR as a company in distress or facing the existential challenges/risks that would typically motivate a sale."

Meanwhile, Reuters is reporting that an unnamed source with Juniper "familiar with the matter" denied the company hired a banker to evaluate bids, or received an offer to be acquired.

 

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