Apple Becoming More Serious About Corporate Acquisitions?

[MacRumors]

BusinessWeek reports on Apple's recent acquisitions of Lala Media and Quattro Wireless, noting that the moves may be part of a broader strategy by the company to utilize its vast cash hoard to increase its historically low frequency of such acquisitions.

In particular, the report notes that Apple last year hired Goldman Sachs investment banker Adrian Perica to assist with such deals. The hiring of Perica, who is believed to be the first dedicated mergers & acquisitions specialist on Apple's staff, reportedly replaces a "super ad hoc" process in which Apple department heads were themselves responsible for building the case for an acquisition and negotiating the terms.

Jobs has long preferred for his company to develop technology in-house and avoid the risks that come with integrating other companies into Apple's unique, finely tuned culture. In the past, there was no organized M&A effort, say three former executives at the company. Instead, business chiefs were supposed to keep an eye out for deals and go to Jobs if they thought there was a beneficial one to be made. After getting Jobs' O.K., the champion of the idea would pull together a team to make an overture, negotiate terms, and work through the administrative details. "It was super ad hoc," says one of the former executives.

A turning point for Apple was reportedly Google's acquisition of mobile advertising firm AdMob. Apple had reportedly been in discussions to acquire AdMob itself when Google swooped in and made its deal. Stung by the loss of AdMob to Google, Apple apparently moved quickly in its bid to lock up streaming media firm Lala as Google and others began to get involved.

According to the report, experts believe that Apple is unlikely to engage in any blockbuster acquisition deals, instead relying on the small deals that bring very specific technologies, intellectual property, and talent to the company and that the company has relied on in the past. The addition of Perica and the loss of AdMob to Google's grasp, however, suggest that Apple may be looking to become more aggressive in its pursuit of those companies that fit its needs.

Article Link: Apple Becoming More Serious About Corporate Acquisitions?

 

[Rot'nApple]

Buy me! Buy me!

 

[theheadguy]

I realize many people here (notably people who have joined within the last one or two years) are blown away by Apple's product announcements, but I am fairly bored as of late. Ok -- the slate is coming (or not). Regardless, I'd love to see Apple become extremely aggressive as it relates to acquisitions and start entering even more market segments.

... and am I the only one who thinks the "i" in front of the product names is starting to get really, really lame? It's cool to keep the iPod, iPhone, iTunes, iPhoto, iMovie, iMac, iBook, iDVD but please..... no iSlate....

 

[Mactagonist]

If I were in charge, Palm and Netflix would be next on the list.

 

[nzsilverfox]

... Apple quietly buys Kodak ...

 

[cmaier]

If I were in charge, Palm and Netflix would be next on the list.

Netflix would be very interesting, but not sure how they're streaming (and other) rights transfer to an acquirer.

 

[rick30324]

Buy Dropbox

Please.

 

[cvaldes]

If I were in charge, Palm and Netflix would be next on the list.

I would like to know what you think Palm brings to the table. As far as I can tell, Palm has no desirable technology, no mindshare, dwindling marketshare.

As to Netflix, I think Apple can compete with Netflix by building up competitive services in-house.

And as an AAPL stockholder, I'm not keen on Apple acquiring what I see as two over-valued companies. The percentage of shares shorted of float is 31% for Netflix; the market thinks this stock's price is going down.

It's even worse for Palm. The short percentage is a whopping 62%. That's right: more investors think this stock's price is gonna tank than those who think it's going to increase. Palm's financials are ugly as hell (almost $400M of debt?). My guess is if Apple announced that it was going to purchase Palm, the shareholders would not approve the transaction. I certainly wouldn't.

 

[iChan]

I realize many people here (notably people who have joined within the last one or two years) are blown away by Apple's product announcements, but I am fairly bored as of late. Ok -- the slate is coming (or not). Regardless, I'd love to see Apple become extremely aggressive as it relates to acquisitions and start entering even more market segments.

... and am I the only one who thinks the "i" in front of the product names is starting to get really, really lame? It's cool to keep the iPod, iPhone, iTunes, iPhoto, iMovie, iMac, iBook, iDVD but please..... no iSlate....

You said it bro. It's been pretty lame since the iPhone.

 

[macduke]

Please.

Yeah, they need to buy someone who makes file transfers easier and MUCH faster. I doubt their new server farm will do much. It just seems like they are inefficient.

In my ideal world, they would also buy Nintendo. As to whether or not that makes business sense: hell if I know?!? I don't even know how much Nintendo costs. I just want all their games and tech melted with everything that makes Apple a great hardware / software designing company. Haha, iWii. Gross. But seriously, I think Apple could seriously clean up in the games space.

 

[JonHimself]

C'moooooon Dropbox.

Edit: Sorry... missed this one above

Please.

 

[illustratorDavi]

I would love apple to buy wacom.

Then they can bring the cintiq to the masses, adding a pressure sensitive pen and multitouch to the imac.

 

[miketcool]

Do us a favor Apple, and acquire a stake at NBC. It'd be nice to compete within the company with MS. Besides, if you saved Conan, I would never again question any of your sketchy corporate antics.

 

[zoned]

For years I've dreamed of Apple purchasing Adobe Systems...

 

[gstylez]

They need to buy a company that can take MobileMe to the next level. I mean the only thing I like is the mobile gallery and find your iPhone. Everything else SUCKS. Using your email on the browser has major issues and is slow plus I when I send an email it does not add it to my Sent box. This is a paid service and I expect the mail to be as good as gmail damn it.

 

[Eddyisgreat]

For years I've dreamed of Apple purchasing Adobe Systems...

Not gonna happen. Adobe is in the process of moving everything to India by "laying" off people stateside and adding an equal number of people overseas. So Apple would have to move everything back lol.

Besides Photoshop / CS sells more on Windows than it does on OS X.

Anyway what I was going to say was:

No use in Apple "blowing their wad" if nothing good is out there.

 

[Tilpots]

Dish Network or Sprint would be my hope. Not likely, but an end to end Apple experience with no middle man would be wonderful. Not having to deal with a phone or cable company ever again? Priceless.

 

[kddpop]

boxee

i don't want to hack my TV. but i'd really like to watch hulu and stuff. don't know whether boxee would be a valuable asset. perhaps they just need to want to offer those things.

 

[huntercr]

... Apple quietly buys Kodak ...

That's actually not so unlikely.

The best time to do that would have been in about a year ago... in March of 2009 they were briefly at around $1/share

They aren't profitable at all, and other than these patents I don't think Kodak has anything Apple wants....
I know you were joking, but who kows maybe they'd do it. With 286M shares outstanding, they could easily buy the entire company for $1.3B at the current share price

 

[huntercr]

Not gonna happen. Adobe is in the process of moving everything to India by "laying" off people stateside and adding an equal number of people overseas. So Apple would have to move everything back lol.

Besides Photoshop / CS sells more on Windows than it does on OS X.

Anyway what I was going to say was:

No use in Apple "blowing their wad" if nothing good is out there.

And you don't want to buy up companies that are making successful products for your existing business. You want to buy companies you *want* to make products for your existing business.

 

[Rocketman]

Gee, now that it is one of the biggest corporations in the USA and the world, they are becoming serious about "something". Both surprising and appropriate.

Dudes (note lingo), if you want help identifying things that are "insanely great", contact me. I am willing to work for fun (and a % of the deal).

Rocketman

 

[rdowns]

I don't see a company mentioned in this thread that I think makes sense for Apple to acquire.

Palm- Why? They have nothing Apple needs, not even a desirable patent portfolio.

Adobe - Why? They are not going to stop developing for the Mac platform. Too much of their revenue comes from it. Apple isn't into selling software anymore per se, they're into taking 30% off the top for you to sell your software through their store.

Netflix- Why? Do they do something special in streaming that others do not?

Dropbox- Why? They could certainly develop OS level syncing if they wanted to. I'd love to see it but buying them a waste. I bet 99% of their accounts are 2Gb free accounts.

 

[lightpeak]

When I see serious, I take it as agressive. And I take agressive as flexing more muscle (like when people say "Google is becoming evil").

 

[sonicboom]

i don't want to hack my TV. but i'd really like to watch hulu and stuff. don't know whether boxee would be a valuable asset. perhaps they just need to want to offer those things.

There is nothing that boxee has that Apple cannot do better - if they wanted to.

 

[sonicboom]

Sonos would be a nice fit technology wise for Apple.

In my house, it does for music what tivo does for video. Granted it's not a recorder, but it puts a vast library of music at my fingertips anytime I want to hear it, anywhere in my house.