UNIX Consulting and Expertise
Golden Apple Enterprises Ltd. » Posts for tag 'ibm'

Latest on the IBM/Sun deal Comments Off on Latest on the IBM/Sun deal

Looking for UNIX and IT expertise? Why not get in touch and see how we can help?

An updated story in the Wall Street Journal sheds some more light on the progress to the deal.

Apparently Sun’s board have rejected IBM’s offer – which I think is a sensible move. IBM asset-stripping Sun seems to be the most likely outcome of any deal.

More interesting is the news that Sun’s board is allegedly split, with Schwartz supporting a buy out, and McNealy opposing it. With the news that NcNealy is allegedly heading up a group that wants to take control of Sun and take it private, this is an interesting development.

Is Scott McNealy the right man to take the helm at Sun? Personally, although I think Sun’s management team are good, they lack experience with anything other than a growing company – and that shows with continued losses.

Arguably McNealy has a similar background – but he’s brought Sun through some tough times before, and potentially has the experience to steer Sun through the current problems. As I’ve mentioned before, he also has the mindset and investor confidence to support that.

The question is – what has McNealy been doing since he stepped down as CEO? He’s still Chairman of the Board, and he’s watched Sun continue to make big losses. Is he taking a long game plan to regain control, or is he as culpable as Sun’s current management team?

What future for Schwartz though? He’s been CEO for a few years now, and hasn’t managed to boost Sun’s fortunes. On top of that he’s overseen open-sourcing Sun’s crown jewels, and not following through with selling the support services around that. That’s a pretty major failing in execution.

With Schwartz pushing a deal that would see Sun swallowed whole by their main competitor, and with nothing else to offer investors and Sun’s customer base, I can’t see how he can continue as CEO. Likeable though he is, his position is now untenable, and with him backing a deal with IBM he’s showing Sun’s customers that he’s out of ideas and sees no future for the company.

I don’t believe that is the case at all, and I think he’s sending a very negative message. With IBM backing away I’m not sure he will retain his position for much longer.

Will Scott McNealy and Carl Icahn take Sun private? 1 comment

Looking for UNIX and IT expertise? Why not get in touch and see how we can help?

I’ve speculated before about Sun taking itself private – it certainly has the capability to do so, even withstanding the dents to it’s balance sheet due to the questionable purchases of StorageTek and MySQL.

News comes from iNewswire that McNealy has resigned from his position at Sun to head up an investment team which will be launching a counter-bid for Sun.

With Paul Ottelini of Intel’s comments that Sun had been hawking itself around Silicon Valley, it’s clear that Jonathan Schwartz either:

  • sees no future for Sun as a stand-alone company
  • is trying to sell the company while he can recoup some value from it
  • has been pushed down this path by Sun investors who don’t understand IT or R&D (yes Southwestern Asset Management, I’m looking at you)

The last point seems the most likely – with the current economic conditions, many investment funds are desperate to recoup whatever cash they can in the short term, as investors panic and want to pull their money out or re-balance their portfolios.

If Scott and his team can follow through, this can only mean good news for Sun and it’s customer base. Like Steve Jobs at Apple, Scott has the narrow focus to push through his vision of how things should be done. Whether he can pull off the whole Jobsian Messiah thing remains to be seen, but I’d place far more credence in that happening than IBM doing anything other than asset stripping the company.

Have a read through the iNewswire release yourself and see what you think.

All change – consolidation in the world of IT Comments Off on All change – consolidation in the world of IT

Looking for UNIX and IT expertise? Why not get in touch and see how we can help?

The rumours continue to do the rounds about the IBM/SUN acquisition, and on top of that comes news that Rackable are to acquire Silicon Graphics.

At this stage no-one is giving out any specifics, which is understandable as neither deal has been finalised and signed off. The coming weeks will be interesting as we get more details from the companies involved.

One thing is certain – with the consolidation of such major players in the IT and HPC business, the industry itself is clearly in the middle of a major shake-up.

When the dust finally settles, will we be seeing business as usual with a smaller number of larger players? Or will the companies involved take the opportunity to deliver some real innovation in the middle of this economic slump?

IBM to buy Sun? 1 comment

Looking for UNIX and IT expertise? Why not get in touch and see how we can help?

The Wall Street Journal is reporting that allegedly IBM are stumping up $6.5 billion to buy Sun.

The Wall Street Journal, quoting “people familiar with the matter,” reported Wednesday that International Business Machines was in talks to buy Sun for at least $6.5 billion in cash, a premium of more than 100 percent over the company’s closing share price Tuesday. Officials of Sun and IBM could not immediately be reached for comment.

This would be a seismic shift in the IT landscape, potentially bigger than Compaq’s take over by HP – consider all the large installations and government contracts that this would effect.

I have very mixed feelings about this, and will avoid commenting until we get some more details. If nothing else, it’s provided a nice boost to Sun’s stock.

Top of page / Subscribe to new Entries (RSS)