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IBM retracted Sun acquisition offer
By Fabio on Monday April 6th 2009 04:41 | Category: Hardware
Even though IBM and Sun appeared to be close to a deal at a lower offer than first agreed, the negotiations appear to have seized in the last stages and IBM has possibly retracted it's offer all together.
Halfway around March the first rumors surfaced about IBM and Sun negotiating on a possible acquisition. It appeared this weekend would be the final stages in these negotiations: IBM would be prepared to put 7 billion dollars on the table, 750 million less than offered in earlier conversations. As a matter of trade for this reduced price Sun demand to get a guarantee IMB follows through with this deal even though the company gets criticized by competition authorities. IBM and Sun together own over 65 percent of the high-end Linux-servers and practically own the whole tape-storage market.
Sunday however Sun chose to dismiss the formal offer by IMB and said to no longer negotiate with IMB exclusively, resulting in IBM retracting it's offer all together. Sun's board would be scattered about the proposed deal: Sun founder Scott McNealy would be against an acquisition while ceo Jonathan Schwarz would support a deal such as this one. The offered amount of money would not have been the primary objection for McNealy. The biggest objection however is that this offer still leaves IBM with an easy way to back out of the deal therefore leaving Sun in a weakened state. It's said there's still conversations between IMB and Sun, but the situation would have landed in an impasse.
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