Brocade Holds Talks With P-E Firms Over Potential Sale

Brocade Communications Systems Inc. (NASDAQ:BRCD) has received first-round bids after holding talks with at least half a dozen potential private equity buyers.

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Sources said Brocade, which has a market value of nearly $2.7 billion, hired Frank Quattrone’s Qatalyst Partners in November to focus on a deal that could result in a leveraged buyout.

Brocade shares jumped more than 9 percent on Monday after Reuters reported that the company was exploring a sale, and had met with a handful of private equity firms, including Silver Lake Partners, TPG Capital LP, KKR & Co. LP, Blackstone Group LP, Bain Capital, and Warburg Pincus LLC.

The latest decision to sell marks the company’s third since 2009, and sources caution that, as was the case with Brocade’s previous attempts to sell, no deal may materialize.

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