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What is the $700 million by Kohlberg Kravis Roberts & Co (KKR) in Sun Microsystems going to mean to my company and me? To answer this question I have to speculate what's in it for KKR.
KKR is all about value creation and they say on their web site that their deals share some basic features:
What is the $700 million by Kohlberg Kravis Roberts & Co (KKR) in Sun Microsystems going to mean to my company and me? To answer this question I have to speculate what's in it for KKR.
KKR is all about value creation and they say on their web site that their deals share some basic features:
"KKR provides equity dollars and borrows money for the
friendly acquisition of a business with predictable cash flows and
strong management." (source: http://www.kkr.com/who/approach.html)
They are providing $700 million and they will nominate a member to
Sun's board of directors. We know that this is a deal. We know that
their deals involve value creation. We know that their deals share the
basic feature of providing equity dollars for friendly acquisition.
Therefore, as I see it, we know there will be an acquisition of Sun
Microsystems.
Why now and why to my beloved SUNW? Yes, that's right, I love
SUNW. I have a "Sun Certified Programmer for the Java 2 Platform"
certificate signed by Scott McNealy. I have heard the inspiring words
of Jonathan Schwartz and Scott McNealy in a JavaOne conference that I
attended some years back.
Here is why and here is why now. In press releases, Sun Microsystems states their singular vision:
"The Network Is The Computer" -- guides Sun in the
development of technologies that power the world's most important
markets. Sun's philosophy of sharing innovation and building
communities is at the forefront of the next wave of computing: the
Participation Age.
So if "the network is the computer" then why is Sun Microsystems a
hardware company. Why isn't Sun's business more about the communities
that their hardware and software helps build? Sun has set their
important software free (Java, Solaris, OpenSPARC,...) and now, I
think, is the time to free themselves from their hardware business and
make a ton of cash in the process.
Why would they not want to spin off the hardware business and who
better to help them do this than KKR? Sun has said that OpenSPARC will
"enable more bright minds to build on a proven technology core." That
means that almost anyone can build a computer and a great processor now
too. Where does it say in Sun's vision that they want to build the
greenest, the fastest, and the best hardware in the world. In fact,
with OpenSPARC they have allowed the other guys to do just that. Why
build the hardware when Solaris will run on practically anything
anyhow. Now Sun can truly focus on its vision and leave the hardware
building to the other guys.
Arguably, Sun is one of the most successful Engineering companies of
all time. This engineering includes the software they write, the
services they provide, and most importantly the value in the people who
are behind that software and those services. I think that Sun and the
people behind Sun will enter the "Participation Age" with the cash and
the intellectual expertise that it will take to be...
[_] A. The next Google.
[_] B. The next YouTube.
[_] C. The next Yahoo.
[_] D. The next EBay.
[_] F. [As] big a piece of the future as possible.
[X] G. All of the above and more.
Best wishes to Jonathan Schwartz and Sun Microsystems. Yes, Tommy,
"it's not too late to build a better world", a more participatory
world, and a sunnier world at that!
Read the original article: http://ansirca.blogspot.com/2007/01/kohlberg-kravis-roberts-co-invests-in.html |
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