AT&T has agreed to buy T-Mobile for $39 billion. You already know this, and you also know that Sprint is vehemently opposed to the deal. Verizon is so far indifferent, or at least that's the face they're putting on publicly. What we don't know yet is how the FCC is going to react to the proposed acquisition, and that's what the deal ultimately hinges on. If recent comments made by an FCC official are any indication, AT&T's legal team has their work cut out for them.
Barron's, part of The Wall Street Journal digital network, reported a rumor this week that Dell may acquire AMD, the world's No. 2 maker of PC processors. The speculation that AMD might be up for grabs, whether by Dell or anyone else, initially pushed AMD's stock up 35 cents, or 4.2 percent, to $8.63. It's now trading at $8.75. So how likely is this to happen?
In some alternate universe, perhaps Western Digital is able to acquire Seagate and instantly more than double its hard drive sales. But in this one, Seagate ultimately scoffed at WD's takeover proposal, or so that's the story "two people with knowledge of the matter" say, according to a Bloomberg report.
The sources say WD was willing to fork over anywhere from 10 percent to 50 percent mor than TPG Capital, another firm that unsuccessfully tried to acquire Seagate. When news of WD's proposal hit the news wire, Seagate's stock surged 7.2 percent. So why didn't Seagate bite?
Both companies declined to comment, but the general consensus is that such a mega-deal would have sparked an antitrust investigation. On top of that, some management personnel would likely have lost their jobs.
Seagate's market value currently sits at about $6.9 billion. Western Digital, despite reporting lower sales than Seagate, is worth about $8 billion.
Investors of 3PAR Data, maker of storage arrays for open-systems and online storage environments, may want to send Dow Jones a bottle of wine. Why? It just seems like the thing to do when the company's stock jumped 12 percent following a report in Barron's, Dow Jones' financial rag.
The article suggested 3PAR was a "takeover target," pointing out that the company is on pace to record $195 million in sales in 2009, with no debt and some $104 million in cash and equivalents. And even though 3PAR has lost money every year for the past five fiscal years, sales for the company's exotic disk arrays have grown steadily.
"Over the past decade, we have seen more than 10 start-ups, each aiming to be the next EMC," said Kevin Hunt, a senior technology analyst at Hapoalim Securities. "3PAR is the only survivor. In my view, they will likely continue to take market share from all their bigger rivals."
According to Barron's, 3PAR's greatest asset is that "the company's data storage systems do more with less."
For a long while, things weren't looking too hot for Oracle in its planned $7.4 billion acquisition of Sun Microsystems. While the U.S. Department of Justice approved the deal, the European Union voiced serious displeasure over the idea of an Oracle-owned MySQL and threatened to block the deal.
That no longer looks to be the case. Now the European Commission is saying it feels "optimistic" that a deal between Oracle and Sun would no longer pose a threat to the European market for database software. So why the sudden about-face?
Oracle promised to preserve the viability of the free and open-source MySQL database application that it would acquire in the deal. According to a report in The New York Times, Oracle vowed to extend MySQL's existing commercial licenses for up to five years, while also making binding guarantees to companies and individuals that already use MySQL that it would not pursue intellectual property claims.
On top of it all, Oracle also said it would spend upwards of $72 million over the next three years in R&D to improve MySQL, negating any concerns that Oracle would turn a cold shoulder to the open-source database app in order to better sell its own paid software.
"Today's announcement by Oracle of a series of undertakings to customers, developers, and users of MySQL is an important new element to be taking into account in the ongoing proceedings," said Brussels' merger officials in a statement.
If you can't beat 'em, buy 'em, and most would agree that Netflix has grown too large (and too strategic) to beat. So who wants to buy them? If you believe the latest rumor, Amazon wants to buy the online DVD rental service, news of which has sent Netflix stock soaring to the highest it's been in 11 weeks.
"There's heavy call buying and the stock is up on renewed takeover talk, with Amazon being mentioned specifically," said Fred Ruffy, the senior options strategist at WhatsTrading.com. "It's pretty typical of speculative buying."
While Netflix and Amazon both compete in the Internet video business, not everyone is convinced a takeover makes much sense. Michael Pachter, an analyst for Wedbush Morgan Securities, points out that Amazon has distribution centers all across the U.S., meaning the company would have to collect sales tax in those states. Should that happen, subscribers would likely end up footing the bill.
As expected, both Amazon and Netflix said they don't comment on rumors or speculation.
In what amounts to a virtual corporate staring contest, only less exciting, both Sun Microsystems and IBM appear unwilling to blink first and wants the other to make the first move towards an acquisition. For Sun's part, the company is now saying it would be willing to resume takeover talks with IBM, provided IBM makes a stronger show of commitment to seal the deal.
IBM had previously offered close to $7 billion to acquire Sun, but Sun, skittish that IBM would change its mind in the face of an antitrust review or other barriers, as well as feeling that the amount was too low, rejected the bid and said it would no longer negotiate with IBM exclusively.
Since the talks broke down, Sun's shares have fallen, causing the company to lose about 28 percent of its value. IBM's shares have fallen too, but to a much lesser extent.
Both Sun and IBM refused to comment on what progress, if any, is being made.
Fujitsu will have to wait longer to get rid of its blighted hard disk drive business as talks between the Japanese company and Western Digital failed to bear any results. Kuniaki Nozoe, Fujitsu’s President, stated in the most unequivocal fashion possible that the deal is off. According to him, the talks fell off after Western Digital refused to accede to Fujitsu’s demands.
Fujitsu was keen on selling its Japanese plants and the ones abroad as a bundle. It even insisted upon most of the people employed in its hard drive business retaining their jobs. According to a Japanese newspaper, the asking price was $550 million.
Research In Motion, maker of the Blackberry, is in a bad way. The recent economic crisis has seen their stock fall from $148 to $60 in just 4 months, Reuters reports, leaving the company on shaky footing.
At the same time, Microsoft is looking to strengthen its presence in the handheld market, an arena recently invaded by two of the Redmond giant’s key rivals: Apple and Google. There have been rumors of Microsoft’s interest in RIM for years, but the Blackberry maker’s present financial situation has renewed and reinvigorated talk of a Microsoft takeover.
Peter Misek, an analyst with Canaccord Adams has said “RIM is a massive strategic fit [for Microsoft]. I’m fairly certain they have a standing offer to buy them at $50.”
It’s unknown how strongly the co-CEOs of RIM would oppose such a deal. If they resisted strongly, it’s considered unlikely that Microsoft would attempt a hostile takeover.
We can already hear the moans and groans, but nevertheless, a Yahoo investor has proposed a new deal today to sell the search company to Microsoft for $22 a share. That figure represents a 74 percent premium on the company's current stock price.
The proposal calls for Microsoft to "unload Yahoo's Asian assets and non-search businesses, extract $3 billion worth of cost savings, and receive $2.8 billion of tax benefits," Reuters reports. All tallied up, the deal would have Microsoft paying $10.3 billion for Yahoo's search business.
Mithras Capital, the investment fund who came up with the proposal, owns a 14 percent stake in Yahoo (1.9 million shares) and said in a press release that if approved, Microsoft would be buying Yahoo's search business for $2 billion less than what it offered in July.
Whether or not anything comes out of this remains to be seen, but it's worth noting that Yahoo today fell into the $12 per share range for the first time.