View Full Version : IBM bids for Sun

30-03-2009, 03:12 PM
I.B.M., Looking to Buy Sun, Sets Up a Software Strategy (http://www.nytimes.com/2009/03/19/technology/companies/19sun.html?_r=4&ref=technology)

I.B.M.’s interest in acquiring the server computer maker Sun Microsystems for nearly $7 billion may seem at first to be a reversal of its recent efforts to move away from the hardware business.

But analysts say there is more to Sun than servers, which are used in corporate data centers. They say its strengths in software, systems design and research make it an attractive target.

The price tag being discussed by the companies works out to nearly $10 a share, a person with knowledge of the negotiations said on Wednesday. That is approximately twice Sun’s closing price on Tuesday. Shares of Sun surged nearly 79 percent Wednesday on news of the negotiations, to close at $8.89.

I.B.M. has pared back its dependence on hardware, where profit gains have declined, while increasing its investment in higher-margin software and services businesses. It sold off its personal computer business to Lenovo of China in 2005, and its hard-disk drive unit to Hitachi of Japan in 2003.

Sun has a solid share of the market for server computers used in corporate data centers, but it too has been trying to expand in more profitable businesses. While it is struggling financially today, the Silicon Valley company has long been a source of technological innovation.

30-03-2009, 03:21 PM
Also, these bits for the Microsoft haters:

I.B.M. uses Java extensively in its big software group, which trails only Microsoft in size. ...

If it acquired Sun, I.B.M. “would unify those warring groups and make for a stronger front against Microsoft,” said Michael A. Cusumano, a professor at the Massachusetts Institute of Technology’s Sloan School of Management.

Both I.B.M. and Sun boast sizable communities of third-party software developers who write programs using their technology. An estimated one million programmers use Sun’s technology, while I.B.M.’s vast software business claims eight million.

Both companies not only support Java, but are also backers of the open-source operating system Linux, a rival to Microsoft’s Windows in data centers and on some desktop personal computers. In 2008, Sun increased its commitment to open-source software by paying about $1 billion for MySQL, a company distributing an open-source database that is used in Web commerce sites.

Redmond Barry
30-03-2009, 03:33 PM
that pretty audacious for i.b.m. to be doing that.

i mean they could of tried taking over the moon first.

but good luck to them i say. ;) ;)

....... ill take my coat and leave.

30-03-2009, 03:34 PM
That is an interesting argument. However I would be concerned about the loss of diversity in the marketplace in general. One less alternative , even if the loss is just the merging of two similar competitors, means the anti-Microsoft eggs are collecting into a decreasing number of baskets.

31-03-2009, 10:22 AM
That is an interesting argument. However I would be concerned about the loss of diversity in the marketplace in general. One less alternative , even if the loss is just the merging of two similar competitors, means the anti-Microsoft eggs are collecting into a decreasing number of baskets.

Not so sure about the above. If the takeover occurs, I doubt that many Sun products will be rebranded as IBM. Solaris in particular is a valuable and well regarded product that competes head-on with an IBM offering (AIX) and would ideally not be branded as an IBM product.

Diversity of entities may reduce but the diversity of technologies and offerings, I suspect, would be little changed by the takeover.

06-04-2009, 01:07 PM
I.B.M. Withdraws $7 Billion Offer for Sun Microsystems (http://www.nytimes.com/2009/04/06/technology/business-computing/06blue.html?_r=2&hp), one day after Sun’s board balked at a reduced offer, according to three people close to the talks.

The deal’s collapse after weeks of negotiations raises questions about Sun’s next step, since the I.B.M. offer was far above the value of the Silicon Valley company’s shares when news of the I.B.M. offer first surfaced last month. Sun, an innovative pioneer in computer workstations, servers and Internet-era software, has struggled in recent years and spent months trying to secure a suitor.

With I.B.M. and others shying away from a deal, a bruised Sun could be forced to continue pursuing a solo business model whose prospects have been questioned by many analysts.


17-07-2009, 04:49 PM
Sun Microsystems shareholders OK sale to Oracle (http://www.bizjournals.com/sanfrancisco/stories/2009/07/13/daily67.html)

Sun Microsystems Inc. shareholders approved the company’s sale to database software giant Oracle Corp.

The takeover of Sun by Redwood City-based Oracle still requires U.S. Department of Justice scrutiny and Oracle’s own shareholder OK.

In April, Oracle (NASDAQ: ORCL) offered $9.50 per share for Sun — about $5.6 billion — putting the total price tag at $7.4 billion including the Sun debt that Oracle will assume.

A 62 percent majority of common-stock owners of Santa Clara-based Sun (NASDAQ: JAVA) approved the deal in a special meeting.

Oracle hopes to close the deal as soon as next month. It predicted Tuesday that the purchase will add as much as $1.5 billion to the company’s non-GAAP annual profits.

Sun has struggled to make profits in recent years despite a solid foothold in high-end servers and wide use of its Java programming language.

24-12-2009, 10:19 AM
And Then There Were Three: POWER, x86 and z (http://www.clabbyanalytics.com/uploads/ServerMarketViewFinalFinal.pdf)

There is a major shakeout underway in the midrange/high-end server market place as sales of Sun SPARC/CMT (cellular multi-threading) and Hewlett-Packard Itanium-based servers decline significantly — and as a new, more powerful versions of Intel’s Xeon and IBM’s POWER micro-architectures come to market. ...

Sun server sales are slumping badly (Sun’s revenue from new products in its fiscal first quarter dropped 33% — and server sales declined by 41%);

Sun customers are abandoning SPARC/CMT servers and migrating to other platforms (Hewlett-Packard [HP] has migrated about 100 Sun customers to its platforms over the past six months; IBM has migrated over 170 in Q2 and Q3 2009 Sun customers to POWER during the equivalent time frame); and,

HP Itanium-based server sales are floundering (sales were down 30% last quarter in HP’s business critical systems group) — and sales of HP’s HP/UX operating system are also appear to be on the decline.

Unable to regain its footing after the Internet bubble burst, Sun eventually became a take-over candidate. ... From a financial perspective, Oracle has stated publicly that it expects the Sun acquisition to be accretive to Oracle’s earnings... But Clabby Analytics does not believe that Oracle can meet these goals, and here’s why:

1. Since Oracle’s initial bid, the company has run into major regulatory barriers — forestalling Oracle’s takeover while crippling Sun’s ability to do business. According to Oracle, Sun is losing $100,000,000 per month due to regulatory delays. Huge revenue losses such as this undermine Sun’s market value while eroding its customer base.

2. Instead of saving Sun and its installed base, Oracle’s acquisition plan has had quite the opposite effect. Sun customers, left in acquisition limbo, have started to migrate away from Sun platforms en masse — moving in some cases to HP servers, but in the majority of cases to IBM POWER servers.

3. By some estimates, it takes about a half-a-billion dollars to design, test, and manufacture a commercial server microprocessor architecture....

4. Sun has recently laid-off (made redundant) 3,000 of its employees (and may have lost others through attrition) — in the process losing valuable engineering, sales, and marketing talent. This “brain-drain” does not bode well...

30-09-2010, 12:58 PM
IBM Moves to Acquire Blade Network Technology (http://www.crn.com.au/News/233645,analysis-ibm-to-compete-with-hp-cisco.aspx)

IBM's proposed acquisition of networking blade switch vendor Blade Network Technologies, while not nearly as dramatic a move as HP's acquisition of 3Com, nevertheless shows that IBM is serious about being a player in the nascent converged infrastructure market.

With that acquisition, once completed, IBM puts itself in a better position to compete with Hewlett-Packard and Cisco in the converged infrastructure market.

However, the move could also adversely impact IBM's relationship with Brocade while pushing Brocade into a closer relationship with Dell.

IBM on Monday said it plans to acquire Blade Network Technologies, or BNT, a developer of blade and top-of-rack networking switches, for an undisclosed sum.

The acquisition, expected to close in the fourth quarter of 2010, gives IBM control of the third leg of the technological troika of servers, storage, and networking required to develop a credible converged infrastructure offering.

Converged infrastructure is the tight integration of server, storage, networking, virtualisation, and other resources tied together as part of a single-vendor data centre solution.

Such a solution can be managed as a single system. Its resources can be dynamically allocated as needed, providing higher resource utilisation and availability than possible with static infrastructures.

With BNT, IBM gains the ability to more closely tie its blade server, storage, and networking technologies into a single architecture, making it only the second major IT vendor to do so after arch-rival HP and its Matrix converged infrastructure offering.