Citrix announced acquisition of XenSource for $500 million

Citrix announced today that they are acquiring XenSource for $500 million.  I don’t personally understand such a high price for an acquisition where the existing company had less than $5 million in revenue last year.  Also, Citrix has stated that they expect this acquisition to result in $50 million in revenue for fiscal year 2008, but at an expense of $60-70 million in total cost of revenue and operating expenses.  Again, I don’t get it, but I’m keeping my fingers crossed…considering I actually own shares in Citrix 

There’s additional commentary over at Brian Madden’s site here.

Shawn

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