m&a

Open-source M&A: The scorecard to date

What is the value of an open-source asset? Over the past several years, and most recently with SpringSource, we've seen a number of open-source companies acquired at valuations of 10x or better. Did the buyers get their money's worth?

It's a tricky question to answer--and likely depends upon far more data than I have at my disposal. It also depends on the acquiring company executing, which has not been the case with Yahoo (which bought Zimbra) or Sun Microsystems (which bought MySQL). No open-source company can offer a panacea for an acquiring company's failure to execute.… Read more

MySpace to acquire iLike?

News Corp.-owned MySpace is "close to acquiring" social music service iLike, according to TechCrunch.

The price tag is rumored to be in the neighborhood of $20 million. Representatives from iLike were not immediately available for comment.

The report comes within days of iLike launching a music download store--a development first reported by CNET News--with MP3s available from all four major record labels.

The deal, if confirmed as accurate, highlights the often complicated connections in digital media's elite ranks.

iLike, for example, rose to fame through its close ties to Facebook. The iLike application, since re-branded to simply Music, … Read more

Investor reveals secret to $1.6 billion in open-source success

No other investor has had as much success in open-source software as Peter Fenton, general partner at Benchmark Capital.

A competitive triathlete, Fenton has turned the standard marathon of open-source business-building into a sprint, churning out four big open-source sales--JBoss ($350 million), Zimbra ($350 million), XenSource ($500 million), and SpringSource ($420 million)--while most investors have yet to turn a profit on any.

Not that Fenton is a one-trick pony. He also just sold FriendFeed to Facebook and sits on the board of Twitter. It's fair to say that Fenton can now afford a second Aston Martin.

But Fenton … Read more

VMware puts squeeze on Red Hat with SpringSource buy

I've been writing a lot lately about SpringSource, largely because it has demonstrated a big vision (nothing less than the redefinition of the application server and an end-to-end application story), and so I wasn't terribly surprised today to see VMware buy SpringSource for $420 million. On roughly $20 million in sales, much of that services, it's a rich valuation, but one that is absolutely deserved given SpringSource's potential.

In fact, it's almost certain that SpringSource sold too early, at least as measured the size of potential exits it could have had given a bit more … Read more

Mix and match: The perfect open-source Web commerce company

Occasionally I get brilliant ideas about whom should merge with whom in open source. OK, so it's very occasionally, but I think I'll start sharing them under a "Mix and match" headline.

Forget Fantasy Football. It's time for "Fantasy Open Source."

Over the past few weeks I've spent a fair amount of time with the Acquia team, the company that offers a commercial distribution of the ubiquitous Drupal open-source Web content management system. Drupal is very strong in Web publishing and has an amazing community following, which makes it a nice pairing … Read more

Nokia to acquire contact management start-up

Nokia has signed an agreement to acquire Cellity, a small German company that creates social-network contact management and address book aggregation services for mobile devices.

Cellity's 14 workers will become Nokia employees. But the service will be shut down and existing user accounts will not be transferred to Nokia.

Cellity, which was founded less than three years ago, is based in Hamburg.

Terms of the deal have not been made public. The acquisition is expected to close in the current quarter.

Acquiring small start-ups is nothing new for Nokia. It acquired Plazes last year while the locator start-up was … Read more

Amazon to snap up Zappos

Whoa. This was unexpected: Amazon has agreed to a stock takeover of Zappos.com, a Las Vegas-based online retailer that has become famous for its unusual corporate culture.

While Zappos started out selling only shoes, it has since expanded to other products.

"This morning, our board approved and we signed what's known as a 'definitive agreement,' in which all of the existing shareholders and investors of Zappos (there are over 100) will be exchanging their Zappos stock for Amazon stock," a memo posted to Zappos by CEO Tony Hsieh read. "Once the exchange is done, Amazon … Read more

Red Hat: From manic acquisitions to focused execution

Red Hat is at the top of its game right now, delivering quarter after quarter of impressive performance despite (or, perhaps, because of) a global recession. But it wasn't always thus. Despite a meteoric initial public offering in 1999, Red Hat spent years fumbling about for a winning game plan, dabbling in technologies that took it far beyond its core competence in operating systems.

Small wonder, then, that Red Hat today hasn't risen to the bait to move beyond its core competence.

In fact, it may well have been the burden of its IPO that set Red Hat … Read more

Will Novell, Dell turn to open-source M&A to grow?

Novell was recently rumored to be shopping itself around for a buyer. The new rumors? That it's doing some shopping of its own. In this, Novell isn't alone, with Dell also looking to pick up companies that can expand its product lines, as both look to grow despite CIOs' decreasing willingness to spend. Open source may factor into both companies' M&A strategies.

As reported in Daily News & Analysis, Novell CFO Dana Russell has said the company is "interested in making acquisition in the high-growth businesses like identity security and compliance management software, data centre … Read more