IBM Looking To Acquire Sun Microsystem
Just 72 hours after IBM shipped out its 50 millionth Wii processor, we're now learning that said company could be looking to expand via acquisition. In a breaking Wall Street Journal report, it's stated that International Business Machines is already "in talks" to buy Sun Microsystem, a move that would reportedly "bolster IBM's heft on the Internet, in software and in finance and telecommunications markets."
In reality, IBM and Sun aren't that much different to begin with. Both companies construct computer systems for corporate and enterprise clients, both rely heavily on Windows and neither rely (too) heavily on Intel. Oh, and they both strongly support Linux, Java and free coffee for office workers. We're cautioned that the deal is still in the earliest stages, but a rather huge $6.5 billion figure has already been floated out as the asking price. And yes, that's in cold, hard cash -- none of those volatile stocks or promises it may or may not keep. If you're wondering just how steep a premium that is, try 100 percent over Sun's closing price yesterday. IBM's got an itch that it's willing to pay to have scratched, huh?
Spokespeople for both outfits decline to comment on the report, though people close to the situation have stated that there's still a chance that talks could fail and the whole transaction could fade away into the sunset. Still, if the combination does happen, it'll be an interesting mix of cultures. IBM was built on the East Coast with a more all-business type attitude, while Sun is a stereotypical Silicon Valley startup-gone-corporate that has thrived on innovation but struggled of late.
Interestingly, we're also told that Sun has been looking for acquisition partners for months now, and apparently companies such as HP have declined. It's not shocking to see consolidation being considering in times such as these, but we get the feeling that repercussions from this little tie-up could be felt for years to come. Now, all's that is left to do is sit tight, grab some popcorn and hope for a handshake. Let the drama begin!
In reality, IBM and Sun aren't that much different to begin with. Both companies construct computer systems for corporate and enterprise clients, both rely heavily on Windows and neither rely (too) heavily on Intel. Oh, and they both strongly support Linux, Java and free coffee for office workers. We're cautioned that the deal is still in the earliest stages, but a rather huge $6.5 billion figure has already been floated out as the asking price. And yes, that's in cold, hard cash -- none of those volatile stocks or promises it may or may not keep. If you're wondering just how steep a premium that is, try 100 percent over Sun's closing price yesterday. IBM's got an itch that it's willing to pay to have scratched, huh?
Spokespeople for both outfits decline to comment on the report, though people close to the situation have stated that there's still a chance that talks could fail and the whole transaction could fade away into the sunset. Still, if the combination does happen, it'll be an interesting mix of cultures. IBM was built on the East Coast with a more all-business type attitude, while Sun is a stereotypical Silicon Valley startup-gone-corporate that has thrived on innovation but struggled of late.
Interestingly, we're also told that Sun has been looking for acquisition partners for months now, and apparently companies such as HP have declined. It's not shocking to see consolidation being considering in times such as these, but we get the feeling that repercussions from this little tie-up could be felt for years to come. Now, all's that is left to do is sit tight, grab some popcorn and hope for a handshake. Let the drama begin!
