Elliott Management Corp. has taken a sizable stake in software company Dropbox Inc., the latest target for the activist hedge fund, according to people familiar with the matter.
Elliott has told Dropbox it is the company’s largest shareholder after Chief Executive Officer Drew Houston, the people said. That suggests the hedge fund owns a stake of more than 10%, worth well over $800 million. The two sides have been in talks since earlier this year.
Dropbox, a cloud-computing company with a market value of roughly $11 billion, went public in March 2018 and has been trading below its IPO price for most of that time. Its modest valuation compared with those of other cloud companies such as Salesforce.com Inc. and ServiceNow Inc. has made it the subject of persistent takeover speculation.
That chatter intensified after Salesforce agreed to buy Slack Technologies Inc. last year for $27.7 billion. Other cloud companies have also gotten scooped up recently, including Cloudera Inc., which agreed to sell itself to a pair of private-equity firms earlier this week. Activist Carl Icahn is a big Cloudera shareholder.
Dropbox’s primary offering is cloud-based storage, which allows users to store documents, photos and videos online. The company also has an offering that allows teams to edit centralized documents. It also owns DocSend, purchased in March, and HelloSign, which facilitates digital signatures.