m&a

Techflash suggests that big technology companies like Oracle and Microsoft may re-enter the mergers and acquisitions market in 2009, scooping up companies at low valuations. This bodes well for an industry bent on recovery, but it probably won't help open source.

In an economy that is increasingly kind to open source, open-source companies are seeing revenues rise and will resist the lower valuations that plague proprietary peers.

This isn't to suggest that valuations for open-source companies have increased. Just look at Red Hat's valuation: while Red Hat has held up better than most technology companies, it continues … Read more

The murkiness surrounding Facebook's valuation got in the way of its attempt to acquire Twitter last year, according to a BusinessWeek article posted Sunday.

Early Facebook investor Peter Thiel's interview with BusinessWeek make it sound like while the talks were serious, they simply didn't go that far: "It became pretty clear it wasn't going to happen...The deal would have to be done with Facebook stock. And then you have to figure out how much the stock is worth." Twitter, according to an anonymous source, was told that the social network's valuation was … Read more

The Wall Street Journal has some sobering news for start-ups looking for a big exit: Oracle is "the new IPO," and it's paying pennies on the dollar.

"If I was in their shoes, I would ride it out" and try not to sell.

That's the advice of Sonny Singh, one of Oracle's chief deal makers, but it's advice that cash-strapped start-ups are increasingly incapable of heeding. Oracle and other cash-rich companies, including Cisco Systems, Apple, Microsoft, and SAP stand to benefit.

As The Wall Street Journal points out, with fewer big companies … Read more

A week ago I was somewhat dismissive of Intalio's aggressive acquisition strategy, having been part of a company (Lineo) that tried and failed to significantly scale through acquisition. Intalio has already acquired two companies and is in talks with "five or six others," according to Intalio CEO Ismael Ghalimi, with whom I had the opportunity to talk last Friday.

After talking with Ghalimi, I'm a bit more optimistic on Intalio's chances with this strategy, for a few reasons.

First, while growing through acquisition is both art and science, it helps if a company is already … Read more

As Microsoft allegedly searches for open-source NetBSD developers to work on its Sidekick mobile phone, acquired along with maker Danger last year, the furor is kicking up that Microsoft finally is getting deep into open source.

This, however, is the wrong furor. Microsoft's move into an open-source operating system means little, given that Danger was almost certainly headed down the NetBSD path well before the Microsoft acquisition, as Fabrizio Capobianco of Funambol points out. Microsoft is simply fulfilling the strategic trajectory that Danger had already plotted out.

The real buzz should center on the fact that this is going … Read more

Perhaps Sun Microsystems' valuation of MySQL wasn't too far off. Sun acquired the open-source database leader in January 2008 for a whopping $1 billion, a sum that many rational people thought was way too high.

Perhaps they were wrong; $1 billion is beginning to look like a bargain.

Sun's quarterly earnings report for MySQL suggests that the company brought in $81 million in billings for the second quarter of 2009, a 55 percent jump over the $52 million in sales it did during the first quarter.

That is phenomenal growth, and it puts MySQL on a fast track … Read more

In the midst of reading Paul Rubens' well-reasoned "Linux vs. Unix Values Evident in Red Hat, Sun Market Valuations," I was struck by this thought:

Who might buy Red Hat is a game that can be played endlessly, and just about everyone who is anyone has been mentioned in the past--Microsoft, Dell, Google, Oracle, you name it. So what about another name that's been mentioned less frequently in the past: Sun?

Much of Red Hat's business is selling support services for open-source software, which is an activity Sun would like to be doing more of. Sun'… Read more

Linden Lab, the parent company of virtual world Second Life, has quietly snapped up two companies that had built e-commerce marketplaces on its platform. The two start-ups, Xstreet SL and OnRez, will be combined into the "Xstreet SL platform," a sort of Craigslist-eBay hybrid for the trade of Second Life virtual goods.

Financial terms of the deals were not disclosed.

It's a revenue stream for Linden Lab, which will take a cut of each sale. And, the company says, virtual goods are a $1.5 billion industry. Though a vicious marketing hype-backlash cycle has painted Second Life … Read more

When I commented on The 451 Group's report on open-source mergers and acquisitions in 2009, this is not what I was thinking:

Open-source BPM (business process management) vendor Intalio turns 10 this year and is looking to celebrate by raising the funds necessary to finance a spending spree to acquire 8 to 10 open source vendors.

Intalio buying open-source companies? Well, they'd have to be really small, as Intalio is itself still somewhat small, earning less than $50 million in revenue (likely much less, but I'm not privy to its revenue data).

"Small," however, is part of the plan. … Read more