Citigroup’s John Reilly Walsh this morning upgraded Tibco Software (TIBX) shares to Buy from Hold, and raised his target price to $10 from $9, citing the potential for the company to be acquired. He thinks the company could be worth $11.25-$13 a share in a takeover. (That’s based on 3-3.5x enterprise value/estimated ‘08 revenues.)

Walsh says IBM is the most likely suitor, but adds that SAP, Hewlett-Packard (HPQ), Oracle (ORCL), Sun Microsystems (JAVA), EMC and Cisco (CSCO) all could potentially be interested in buying Tibco. He says Oracle’s (ORCL) deal to acquire BEA Systems (BEAS) “will make suitors look more closely at the last remaining independent middleware vendor.”

Tibco, which rose 75 cents yesterday, is up another 12 cents, or 1.6%, at $7.63.