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Feb 28 (Reuters) - Network gear maker Riverbed Technology Inc rejected Elliott Management's raised bid of $3.36 billion, saying the hedge fund's offer undervalued the company.
Elliott on Tuesday increased its offer by $2 to $21 per share and said it could raise the bid if allowed access to Riverbed's books for due diligence.
Riverbed said on Friday its board unanimously determined not to pursue Elliott's offer, which was not in the best interests of shareholders.
"Riverbed board has again failed shareholders... (the) board has clearly chosen entrenchment over shareholder value," Elliott, which holds a 10.5 percent stake in Riverbed, said in response.
Paul Singer-led Elliott made its first offer in January.
Riverbed has been struggling with the integration of Opnet, a maker of software to manage traffic on networks, which it acquired in 2012 to counter a slowdown in its main wide area network optimization business.
Goldman, Sachs & Co is advising Riverbed.
Riverbed's shares were marginally down at $20.50 on the Nasdaq. The stock has gained about 15 percent since Elliott's first offer on Jan. 8.