Many technology companies have become very adept at handling mergers. Yet it’s still a challenge for some to try and determine the proper timing and goals. Should a company just seek to increase its immediate profits -- or possibly branch out and offer new products or services?
Here’s a look at several of the more successful high-tech mergers forged during recent decades. By studying these carefully (and doing additional research as necessary), your company may wind up in a better position to choose an equally savvy business partner for a merger.
Mergers That Worked: Google/You Tube; Symantec/Veritas; and AMD/ATI
When Google purchased YouTube. At the time that Google purchased YouTube back in 2006, a number of professional tech experts wondered if the $1.65 billion deal was a wise one. Yet as of 2012, YouTube had over 800 million monthly users. Today (in 2014), “more than 1 billion unique users visit YouTube each month.” Furthermore, YouTube is “localized in 61 countries across 61 languages” and the numbers of new daily subscriptions continue to multiply from one year to the next. While a few critics still question what Google really gained from this acquisition, there are clear signs it was a brilliant move. In fact, one 2012 study found that “76% of marketers plan on increasing their use of YouTube and video marketing, making it the top area marketers will invest in for 2012 and beyond.” This purchase was also a very popular move since so many people around the world enjoy using YouTube on a regular basis;
When Symantec purchased Veritas. This 13.5 billion merger provided Symantec with a “much broader range of products,” in addition to other advantages. Today, Symantec continues to provide “security, storage, and systems management software for businesses and consumers . . . [and its] applications handle such functions as virus protection, PC maintenance, data backup and recovery, intrusion detection,” along with many other critical PC needs. Its chief competitors are Microsoft, McAfee,Inc., and Trend Micro Incorporated. The future still looks very bright for this company;
When AMD purchased ATI. Sometimes, things get a bit rocky and unstable before they get better following a merger. That’s what happened to some extent after AMD’s 2006 purchase of ATI for $5.4 billion; the company’s processor sales took a dive and the company “started to hemorrhage cash.” Fortunately, this early set of negative events eventually turned around. Today, this merger is viewed as one that “worked quite well” -- even though AMD now ranks a distant second to its major PC and server microprocessor competitor Intel. (It should be noted, however, that back in 2010, AMD did decide to do away with the ATI brand.)
To obtain help with handling all of your Georgia business planning needs, please contact Shane Smith Law today. You can schedule your free initial consultation with a knowledgeable Peachtree City estate planning attorney by calling: (770) 487-8999.