think-smarter.com Blog » Who Buys Who

Rumor: Tripwire for sale?

RS — Tue, 02 Oct 2007 22:04:45 +0000

The word on the street says that Tripwire has been talking to potential suitors again. One set of negotiations were really close to a deal, or atleast offers were made, but the numbers were too far apart and talks stalled.
I was talking to an M&A professional recently and they said everyone wants their deal priced on the Opsware/HP multiples and valuations and that is just not realistics for most market segments, as they are not hyper-growth segments.

Then I read a press release from Tripwire today which has them re-positioning themselves or what seems like a re-position to “Continuous Data Center Compliance” … and it makes you wonder whether it is an effort to reposition into the Data Center space from the compliance space.

Rumor: EMC to buy Bladelogic

RS — Fri, 16 Feb 2007 14:58:24 +0000

That is the word on the street. Given EMC’s foray into buying management tool vendors, would it make sense for them to buy a provisioning system?

Symantec & Altiris: Death of Anti-*****

RS — Tue, 30 Jan 2007 14:07:31 +0000

The Symantec, Altiris deal is the first recognition of the fact that traditional anti-virus, anti-phisihing etc is a dying market. And this is not because Microsoft (MSFT) has decided to put some of the features in its newly launched Vista release.

Many corporations have realized that traditional anti-***** products stop the “known bad” stuff from entering their infrastructure. But it is much easier to keep track of “known good” stuff which provisioning systems like Altiris do. They make sure that only “known good” where good is defined by the corporate policy or by Dell for consumers is kept on the machines.

Solicore Systems is another example of this, where enterprise change control policy is used to ensure the known good state of the machine. If it came in via enterprise change control it is good, otherwise it is not.

If you can ensure that only known good stuff is on the machine, traditional anti-virus, anti-spam etc is dead.

Google to collide with Citrix?

RS — Wed, 17 Jan 2007 22:14:36 +0000

There is a battle brewing out there: google versus citrix. Sounds absurd, its not. Google wants to become the place where people store thier data, run applications from and do all their computing. That is exactly what citrix does for the enterprise today.

A number of engineering people I have talked to have mentioned that Google’s strength is the distributed application environment they have built which allows people to develop scalable new applications very quickly. The question is whether newer technologies erode the advantages that google has and almost make them like yesterday’s technology when it comes to applications over the web.

The generally held consensus is that Citrix’s current architecture would never scale to something serving millions of people around the world. But that is of their current architecture. The advantage that citrix like approach is that you can take existing applications and just plop them in and they work.

The first question is whether being able to deploy current applications for use over the web be a strong differentiator. I think it will be. The next question is whether it can give Yahoo, Google or Microsoft (or Akamai) a lead over the other. I again think the answer is yes. Microsoft’s live initiative is heading in that direction although it will run into resistance from the cash-cow products of the company.The other angle this competition could come from is from the people who are putting a box in your living room …

That brings us to the question whether a virtualization based approach will get us there. I recently came across a company called Atlantis Computing which has the technology working. They signed up for the Amazon’s grid and have signed up over 5000 users all over the world for their beta. So while Citrix may not get there … the approach will definitely and it will turn the advantages of today dis-advantages of tomorrow for companies like Google.

Musings: Should Opsware be bought?

Administrator — Tue, 31 Oct 2006 23:29:37 +0000

I was talking to a senior analyst (non-financial) and they mentioned that it is a possibility that someone may buy Opsware. There are several large companies who are not as strong on the datacenter/provisioning side of the business. Opsware and Bladelogic are the two strong companies in that space. Who ever might buy them, needs a fat checkbook though — so has to be one of the big players like MSFT, HP, CA, EMC?

Musings: Should Intel buy nVidia?

Administrator — Mon, 16 Oct 2006 00:00:42 +0000

I was recently at a talk by Dave McQueeny, CTO IBM Federal, where he talked about some interesting trends in the industry. One of the things he mentioned was that for some time now it has become difficult for chip companies like Intel to increase the processor speed year after year by 30%.

So it is speculated that Intel stopped marketing giga Hertz as the main reason to upgrade and being smart has shifted the focus to number of core’s in the CPU. AMD has made heat consumption an issue, which again Dave mentioned is an issue because now the power consumed by a processor when its idle versus when it is working is roughly the same and so it never gets to cool down.

Another impact of this shift may be in how ODM’s select chipsets to put on a motherboard. Since they wont be touting giga hertz, they are also shifting to heat consumtion, number of cores etc. Will the graphics capability become an important selling point? You do need sophisticated graphics cards to work with 24″ or 30″ displays.

What do you think?

Rumor: Opsware to buy Tripwire?

Administrator — Sun, 08 Oct 2006 14:36:41 +0000

Opsware stock is trading roughly 10x revenue, high for its sector? Good time to buy companies. Tripwire had about 35M in revenue in 2005 as reported in the Portland Business Journal (http://portland.bizjournals.com/portland/stories/2006/06/05/daily51.html). If revenue this year is around 50 that would be a significant increase for Opsware. If they pay 200-250M for the acqusition the stock should go up 50% because of the revenue jump … making it effectively a 375M acqution … which should be a good outcome for Tripwire … which has raised about 60M.

Rumor: EMC to buy BMC?

Administrator — Wed, 04 Oct 2006 14:55:10 +0000

Ok. Its not driven by the alphabet soup. The rumor abounds though after EMC purchase of nLayers which got them into the CMDB space. There have been rumors about IBM buying BMC and of BMC being taken over by private equity. But EMC buying them may make some sense.

Rumor:Nortel to buy Force10Networks?

Administrator — Tue, 26 Sep 2006 09:35:27 +0000

Thats the word on the street … Check out http://news.tmcnet.com/news/2006/09/18/1901468.htm

Rumor: HP to buy CA?

Administrator — Sat, 16 Sep 2006 14:25:44 +0000

That would be a big one. But people say that HP today can’t fight IBM in mainframe territory. Almost every IBM mainframe account uses CA. So the acquisition can give HP access to most IBM accounts. Also CA’s stock is relatively cheap.

Should Exxon Mobil buy General Motors or Ford?

Administrator — Sat, 16 Sep 2006 14:21:31 +0000

Market Cap of Exxon Mobil: $404B; Market Cap of GM: $17B

They could buy them wothout blinking an eye. Think of the cell phone market, the phones are sold or leased by the carriers, not by the phone manufacturers. Sprint, Verizon, ATT sell us phones, not Qualcomm or Motorolla. Similarly Exxon could sell you cars and fuel at a monthly lease price.

The structure of the lease also would fit well: fixed number of miles and if you go above it there is some charge. Also concepts of roaming etc. fit well … and the economics should work given mostly people are local or withing state. Further with the availability of technologies like OnStar you can prevent theft etc.

Don’t know if it would trigger any anti-trust regulation. But it would surely change the auto-world as we know it.

Rumor: Motorola to buy Juniper?

Administrator — Wed, 06 Sep 2006 12:03:09 +0000

This is a wild one. It has been circulating for some time. I can’t say I understand it, except that maybe Zander does not like Chicago and wants to move back to the Bay Area. It does make sense from a market perspective: both the companies sell to carriers … one for the core of the wired network and one on the wireless side. But they are still selling to the same companies.
From a core technology point of view, I am sure Juniper stuff can be used on the wired and wireless part of the network. So maybe the combination creates a one-stop shop?

Should Apple and Google merge?

Administrator — Tue, 05 Sep 2006 06:19:23 +0000

Should they? They both have a common enemy. Google for the longest time has been trying to get consumers to park more of their data with google. All efforts like 2GB storage with gmail or desktop search, or hosted office seem to be steps in that direction.

Apple offers a very different solution: iTunes today indexes all the music files, videos and also your contacts and calendar. It is trivial for it to do email and other files on your desk also. People who use iTunes and iPod swear by it and really trust and like it. If that becomes a conduit to google that could be powerful.

What would Apple get out of it?

Rumor: Oracle to buy Redhat?

Administrator — Mon, 04 Sep 2006 05:48:22 +0000

There has been a rumor going around that Oracle will buy Redhat. When you ask people why — the responses are very random at best. Some say Oracle has a banking mindset now with Charles Phillips is President … so they are looking for companies with good maintenance revenue streams and are looking at it as a financial transaction.

There is also some talk about this being an extension of the Oracle Unbreakable campaign. That campaign is widely mis-understood … what Oracle was offering there was 24×7 support with SLA that a problem will be resolved in certain amount of time. If a customer reports a problem, the open source community may not address the issue for months, so Oracle said we will fix the problem and give the code back to the open source community. This was to give customers confidence to adopt Linux as their platform.

There are some interesting symbiotic relationships in the open source space. SAP is supposedly a big promoter of MySQL. One view of this is that it is advantageous for a company to commoditize the stack beneath it. As the dollars charged for the stack below would naturally flow to the application and also returned to the customers. From this point of view it might make sense for Oracle to buy RedHat as most of its implementations today run on Solaris or HP-UX or even AIX. And it could offer the OS stack for free, get a maintenance revenue stream and also make the oracle solution more cost-effective with little impact on the price of Oracle.

IBM buys MRO: non-IT, IT asset convergence?

Administrator — Mon, 04 Sep 2006 05:12:31 +0000

IBM’s acquisition of MRO for $740M took some people by surprise. On the surface it was not clear why IBM paid a premium: it shared a large percentage of customers with MRO. Also Tivoli does have enterprise asset management capabilities. As several news articles reported MRO was strong for non-IT asset management: physical assets like tractors,
factory equipment, carts etc. The real question was why get into that business?

Party conversation says IBM is just trying to catch up with HP, after selling off its PC business to Lenovo, HP is ahead in terms of revenue to be the largest computer company. But that can’t really be the reason, can it?

In an insightful conversation with a senior executive, he pointed out that the non-IT assets are getting similar to IT assets. For example, Caterpillar is adding capability to track tractors using IP address and RFID tags, and several IT assets are becoming like non-IT assets. The two business seem to be converging and over the next 10 years or so they will begin to look very similar.

A completely disconnected event: it is rumored that one of the bidders in a recent Service Desk bid was PeopleSoft (or Oracle) bid along with Microsoft. Where they were using PeopleSoft’s system which tracks chairs and tables along with employees as the base to extend to IT assets also.

But maybe it does make sense.

Is AIM a viable option to go public?

Administrator — Sun, 03 Sep 2006 01:40:59 +0000

Every month or so someone talks about going public on AIM (Alternative Investment Market) in UK. The requirements to go public are less strict: there is no SOX requirement, no minimum revenue etc. Almost every investment firm also has a “AIM” specialist you can talk to.

The conversation almost always drifts to liquidity and the general belief that the market is not liquid. So it depends on why you want to go public, for some companies they are looking for currency to buy other companies, or simply because larger companies like to buy from public companies. Those objectives are not met by getting listed on the AIM. Or atleast that is what the impression seems to be.

It does help with personal liquidty, but I haven’t come across a company which has done this yet. I am not even sure it is better than doing something like a DPO (direct public offering) which you can do both in Canada or the US. It is rumored Google contemplated doing a DPO. But in the long term investors prefer that someone has benchmarked the company to not be a fly-by-night operation.