05.05.11
Glyn Moody Believes That Attachmate Will Liquidate/Sell SUSE
Photo by Stuart Yeates
Summary: A new opinion piece about AttachMSFT’s strategy so far
NOW that SUSE is being wrapped up like a fur ball and treated like a separate entity (from AttachMSFT), people start to echo our predictions, nearly insisting that Novell’s restructuring of its divisions over a year ago (SUSE isolated), followed by public bragging about operating in the green there, is a sign of sale to come. It’s essentially a reversal of what happened following the S.u.S.E. acquisition. As Glyn Moody put it minutes ago, “does Attachmate really care about pursuing a free software strategy at all? And if it doesn’t, what will happen to SuSE Linux? Interestingly, Dave Neary was pondering this back when the deal was first announced. As he noted then:
“If you are a Dark Hand type of guy, the financier who wants a return on investment and doesn’t really care about innovation or changing the world, then your goal is to buy assets, perhaps sell a subsidiary or two to recoup some of the costs of the deal, perhaps change the management team, and keep the profitable business for a 5 year horizon before selling it on to make a profit. Your anticiated ROI for this type of deal would need to be around 8% to 10% per year.
“So you sell on some patents & copyrights that you’re not really interested in (presumably with a free license to use said patents for a period of time), you split your business up into the cash cow moneymaker (Old Novell) and the new, growing business that can sell at a high valuiation relative to its earnings (Suse Linux), and you line up a buyer for the speculative Linux business.
“It’s worth reading the rest of the post, where Neary fills in some of the details and numbers. But here I’d like to build on his analysis and ask: assuming for the moment that SuSE will indeed be sold at some point, where would be a good home for it?
“There are actually two answers to that question. The first is the one that will get answered by the market: who will see the acquisition of SuSE as making good business sense. That might include all kinds of crazy options that you and I might not want to contemplate – for example, how about Oracle buying its own distro? What about Microsoft…?” █
