IBM is rumored to be in talks to buy Sun Microsystems for $6.5B.
The consolidation in enterprise technology is upon us. Once mighty Sun Microsystems is now reportedly; in talks to be acquired by IBM for a mere $6.5 billion. That is two quarters of revenues for Sun. If you factor in the $2.6 billion in cash and short term investments on Sun’s balance sheet, the true offer is closer to $4 billion. Sun’s shares jumped this morning 65 percent.
If such a sale indeed happens it would be an ironic end to one of the silicon valley icons. Sun were the pioneers in computer workstations that disrupted the main frame and mini computers and now they may be gobbled up by a company that got started as a mainframe company.
Sun, although a tech innovator that gave us open technologies such as NFS and Java, missed the boat on capitalizing on many waves such as enterprise middle ware (IBM, BEA) , virtulaization (VMware), cloud computing (Amazon) etc. Curiously, their leadership did not change much as they are missing all these opportunities.
It would be a sad ending to an icon.