Business, Enterprise

UPDATED: IBM withdraws its bid for SUN, SUN stock drops 22%

The New York Times reports that IBM has withdrawn its $7 Billion offer recently made to buy up SUN Microsystems. This is putting the maker of Java, Virtual Box, MySQL, Solaris and the UltraSPARC 2+ processor in a difficult situation. They’ve been in troubled waters for quite some time and now face themselves in the need for a safe harbor again.

What made IBM withdraw its bid is not yet known, but it propably will slump the SUN stock at Wall Street when it opens monday morning. The rumors and later confirmed talks between IBM and SUN had pushed the SUN stock value somewhat US$ 5 per share to 8.49 US$ last friday. Reports said that IBM was willing to pay something between $10 and $11 per share to make a big blue sun rise – but some sources stated that the deal was anywhere between 9.10 and 9.40 USD per share.

All in all, an interesting turn of events. If the negotiations really collapsed, that would be second great merger going bust in a sequence, if we all remember the fallout between Microsoft and Yahoo. However, there is a new player in town that might be interested for the company, but not this year.

UPDATE – April 7th, 2009 02:38 AM UTC: After the closure of stock market, result of this breakdown was inevitable: SUN Microsystems stock went spiralling down to stop at $6.56, down almost two dollars or -22.73%. Still, this is much better than the situation before the news story about the take-over negotiations broke out. Prior to the rumors about the takeover, JAVA stock was trading for $3.86. If the share slide stops at $6, Sun did a good job. If not…