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Sun, Novell, and Cray - Time to go private?

amanfromMars

Spilling the Beans .... Honest to Global Operating Devices 

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You can be sure that whenever they don't go private, it will give pause for third party support. And the Cloud, where the Industry is Virtualised with nothing more Tangible than Intellectual Property is where IT is at, nowadays.

Who wants to buy a Dumb Box whenever the Server which Drivers IT is Virtualised in the Cloud and Accessed via the Internet and its Networks InterNetworking Sharing Intel with SMARTer Enabled Virtual Machinery.

The Hyperformance Computer has Evolved Spontaneously into a Global Program of and for Beta Controllers .... Astute Semantic Programmers into Quantum Communications which Virtually Teleport you into an Enlightened Intellectual Space for Administrative Executive Action.

Ian Michael Gumby

Going private isn't as simple as the author suggests.... 

Stop

Someone lending Sun Micro 1.5 billion so that it can take itself private?

Its possible, however, consider what the interest will be on such a loan.

While Sun wouldn't have to worry about qtr by qtr growth, they need to make sure that they are earning enough to pay off their debt. A couple of bad qtrs, and wow. They can go down.

Think of what will happen if they file for bankruptcy?

As to the poster amanfromMars... ?Huh? What he said was pure gibberish.

Colonel Zander

Nope, it's possible 

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Looking at Sun, if we're talking a price of $6 bil in round number, it isn't all that hard to make a case for someone to assist them in going private. First, they have about $2.5 bil in cash and an additional $2 bil in short term receivables. If you consider that they could sell a major asset (say storage) for $2 bil (they bought StorageTek for $4 bil, if I remember correctly - too lazy to google it). The above would raise more than enough money to do the deal and a bridge loan could probably be arranged when times get a little less scary. The upside is that the 'buyer' (Sun + investors) get as much as $9 billion (after selling storage - but also too lazy to look up storage revenues, so this number could be wrong) in cash flow. With some cutting, the company could reliably generate pre-tax profits north of $1 billion....So, at the end of the day, a billion dollar profit on a six billion dollar investment is pretty good these days. However, the major investor who makes this happen should stipulate in the contract that they get to personally cut off Jonathan's pony immediately after the deal is signed and right before they fire him without any sort of parachute, golden or otherwise.

Colonel Zander

Ooops, forgot this point... 

...besides KKR, there is another very interested party. A company called Southeastern Asset Management and their fund affiliate, Long Leaf Partners, now owns almost 19% of Sun common stock. It looks like they purchased it earlier this year, and they are significantly underwater on their investment. 19% is a damn big number for one investment group to own - so far, they're passive, but you have to wonder about longer term plans....

Adam White

@ Ian Michael Gumby 

Alien

Don't worry about amanfromMars, he's our resident sanity dipstick. If nothing he says makes any sense, it means you're fine.

Trevor

@ Ian Michael Gumby 

Hi, you must be new here. Welcom the El Reg's Comments Section. That is amanfromMars. His comments actually DO make sense, often more than most would give him credit for, but it takes a long time to learn to read what he is saying. He's quite a prolific poster, on this, and other IT websites out and about among the tubes. The jury is still our on if amanfromMars is human, or simply an advanced Turing program. (Some theories have amanfromMars being multiple people, but I prefer the single-author theories myself.)

I think you will find there are many people who who post frequently. Stick around, and you'll be able to spot them, even when they post as Anonymous Coward.

Oh, and two more things, don't respond to the trolls, (or Solomon Grundy,) and don't anger the almighty moderatrix, Sarah Bee.

Other than that, I am sure you will enjoy the Reg Comments Section.

Anonymous Coward

Gibberish? 

Alien

As to the poster Ian Michael Gumby... you ain't from round these parts, are you?

dedmonst

Stock purchase: Easier for Sun... much easier for others? 

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The problem with this concept is that although the current travails in the market might make it easier for Sun to go private, it ALSO makes it easier for someone else to buy them up... someone with no qualms about making the sort of changes (and cuts) that the street has been calling for Sun to make for years now.

I know all the Sun fanboys always look depserately for a silver lining in the companies slow and steady collapse, but I just don't think this is it... much more likely is an acquisition.

Christian

Maybe.. 

IT Angle

amanfromMars really is from Mars, that would explain the bollocks he wrote?

I've got a bullshit generator that reads like that guy ;)

Dunstan Vavasour

AMFM 

Alien

Ian, you must be new here - not seen AMFM posting before.

If I were Sun, and thinking of taking myself private (which they probably aren't), I certainly wouldn't burn all my cash. I'd probably borrow to buy the shares, keeping the cash as a war chest.

I like this story rather better than Ashley's FuSu hypothesis a few months ago.

James Anderson

@amanfrommars 

Alien

The second paragraph made sense to me, and was relevent to the article.

Pass the dried frog pills.

David Haig

Sun & IBM 

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Surely a better play for IBM than Novell? With Solaris (and OpenSolaris) on board, they can backburner the SCO row and get control over Java in the process. Then, if IBM feel really flush, they can merge in Cray into what's left of Sun's server operation and finish up with most of the highend mid and super computer market. A 'Cray Starfire' anyone?

Nick Kew

@David Haig 

Can't imagine the competition authorities liking the idea of IBM+Sun much. Add topend hardware and opensource software, and it'd make a complete monopoly.

Tim Bergel

@James Anderson 

Alien

> The second paragraph made sense to me, and was relevant to the article.

It did??? It was???

Are you sure? Looks like a case for more than dried frog pills here...