Posted by Martyn R Jones on February 01, 2002 at 06:47:56:

In Reply to: Re: KM, Business and Mergers: A question posted by Akhil Shahani on February 01, 2002 at 01:31:16:

Hi Akhil,

Yes, the current "merger" between Compaq and HP was "the spark that ignited the posting" so to speak, but I could think of a number of other merger/takeover cases just in the IT industry that can't exactly be hailed up as overwhelming successes, for example: The Burroughs merger with(or more correctly hostile take-over of) Sperry Corporation -- rather cruelly described as the corporate spin on tying a rock to a slowly sinking ship.

Other examples of dubious acquisitions and lost opportunities for synergy have been transactions such as the CA purchase of Platinum.

Other examples that scraped the barrel of incredulity have been things like the "merger" of Compaq with DEC, hardly surprising that this one came back and bit all concerned well and good.

I have seen some pretty good acquisitions made in the IT business, for example, Oracle are great at acquiring what they need through acquisition, so are Microsoft, these companies tend not to buy other companies to destroy their technology and the competition proffered by their products, but rather do use acquisition to fill key and new niches, I think that kind of synergistic acquisition makes sense. I have yet to see a set of rational arguments as to why the Compaq / HP "merger" would work.

Regards,

Martyn

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