Mandrakesoft Acquires Conectiva

rednaxel writes "This morning, both companies issued press releases about the merge. French Mandrakesoft is acquiring all shares of brazilian Conectiva for a total amount of 1.79 million EUR (2.3 million USD) in stock." CNet has coverage of the merger as well. From the article: "This won't elevate us to the status of Red Hat or Novell/SuSE yet, of course, but this is a significant growth for us..."

Comments

How?

[sfraggle]

How do they have the money to do this? Werent they almost bankrupt about a year ago?

Re:How?

[crow]

It's a stock swap. No money is involved. This is typical of how mergers often work. The companies agree to merge, and they agree what the company being acquired is worth, do some math, and convert the shares of the acquired company into shares of the new company. The math is much like doing a stock split, though the ratio usually involves a number of decimal points. (The accounting for the investors is also much like a stock split.)

The real question in this case is why is Mandrakesoft's stock worth enough for Conectiva investors to consider this to be a worthwhile deal (as opposed to grabbing on to a sinking ship). I haven't looked at the business side of either company, so I can't comment there.

Re:How?

[DCowern]

Facts, please.

Mandrake club is currently less than or equal to 28% of their revenue, not the 80% you claim. From their latest quarterly summary:

Product sales amounted to 51% of revenues, enterprise services 21% and online sales and services 28%.

So you're dead wrong about where their money comes from.

Also, your numbers are slightly off. According to that same report, Mandrake is worth about 40 million euros (market value); that's about 50 million USD. Sure, they're not the size of RedHat but that's one of the reasons I like them.

I don't know where you got the loss figure from but I bought the stock at 2.1 euros. On 4 August 2004, it was 2.39 Euros. It is now 7.60 Euros. Unless Canadian math is different than American math, that's a 317% growth in the period from August 2004 to February 2005. Overall, that's a growh of about 361%. That's not a bad return over the 2.5 years that I've owned the stock

Representing your opinion and numbers you pull out of your ass as fact is embarassing when people call you on it, eh? ;-)

And oh, by the way, I happen to like M. LeMarois. He's always been cordial and straightforward in my dealings with him and he seems to have a good idea of where the company should be headed. That, of course, is just my opinion.

Re:From the press release:

[Emporerx]

I don't know about Europe, but I thoroughly enjoy Mandrake. I'm wondering what, if any, effect this is going to have on future releases.
I'm biased because Mandrake really got me into the linux field and away from Micro$oft products. And linux has made computing fun to me again, which has not been the case for some years now.
I say, if they are trying to make things a little more uniform with these sorts of mergers(software, releases, security) then yay for them. Let's see how it turns out.

Been with Mandrake for years

[kbahey]

Being a Mandrake user for several years, I am happy to see that they overcame their financial difficulties and are in a position to expand.

Apart from the botched 9.2 upgrade debacle, they have a distro that I can use for a Linux home network without spending too much time on it. I have four machines running Linux at home, and don't want to spend a lot of time on each configuring it.

They are also familiar and friendly enough for my kids to use it as their only desktop. They get to play their MP3, use FireFox or Konqueror, use Open Office for homework, ...etc.

Moreover, it is also perfectly good as a server for LAMP, Samba, ...etc.

Go Mandrake!

Re:Yet?

[lukewarmfusion]

Don't be so drawn in by the knee-jerk reactions to think that "acquisitions and mergers" are always a bad thing. You buy other companies to gain market share, brands, add to your own line of products and services, etc.

Such a move is often good for consumers, too. Imagine what would happen if all of the cell phone companies were small, local businesses. Not only would your service be crappy, but support and prices would probably suck too. By combining into a few major players, you get national service, a sturdy support system, and longevity - they're less likely to fold and leave you hanging.

You don't get to be the richest man in the world by letting your competition win.

Re:What does MandrakeSoft gain?

[Anonymous Coward]

Brazil's government announced earlier this year it was planning to switch 300,000 PCs from Windows to Linux. I don't know if any contracts have been signed already, but I guess it's not unlikely they would favor a distributor based in Brazil (similar to when the city of Munich went with SuSE).

Re:What does MandrakeSoft gain?

[Coryoth]

I'm not terribly familiar with Conectiva. What does the Mandrake distribution gain with this merger? Just more experienced developers or did Conectiva have certain features that made it attractive?

Well Connectiva were one of the first distributions to embrace apt-rpm (they may even have done a lot of the development work, I can't recall) and provide some of the major development impetus behind Synpatic which is far and away the best GUI package manager around. As far as I am concerned what Mandrake could gain from Connectiva is a move to apt-rpm and Synaptic. I know URPMI has a lot of fans but I think apt and Aynaptic may be the way to go for pakcage management. It helps standardise things as well - all the Debian based distros use apt, and several use Synaptic by default as well, and despite yum being the default apt-rpm and Synaptic is very popular on Fedora, and even SuSE (instead of YaST).

At the very least I hope Connectiva stays with apt-rpm and Synaptic. I would hate to see them shift to URPMI at this stage.

Jedidiah.

Re:What does MandrakeSoft gain?

[NicolaiBSD]

which doesn't give it much weight as far as I'm concerned as I wouldn't trust a pile of shit from .br

Marcelo Tosatti has been maintaining the 2.4 kernels you've been running for a long time. He's a Brazilian working for Conectiva.

You on the other hand are an asshole.

Mandrakesoft = (very) profitable company

[joestar]

From the PR: "Mandrakesoft, founded in 1998, is the internationally recognized number one European Linux company. Mandrakesoft has built its business by designing and delivering user-friendly Linux products to both individuals and businesses, building a user base of more than 4 million users. In its latest fiscal year, Mandrakesoft's revenues reached 5.18 million EUR (6.7 million USD) for a net income of 1.39 million EUR (1.8 million USD)."

Re:What does MandrakeSoft gain?

[leoboiko]

Conectiva made apt-rpm. They also made the smart package manager, which I think is underrated. I hope the Mandrake guys see its potential.

Conectiva Linux will not exactly shift to urpmi, but instead it will be merged into Mandrake Linux.

And remember guys, we're called Conectiva, with a single "n".

Kicking MS out of the 5th largest country?

[gelfling]

What with the Brazilian government wanting to kick MS off all government desktops, the fact that a disproportionate number of distros come from Brazil & it's the 5th most populous country in the world I'd say it's somewhat strategic in nature for Mandrake to do this.

Re:No mucho?

[morcego]

Let me clear some misconceptions on your post.

First, the majority of Conectiva users speak portugues, not spanish. I would guess at least 70% of the user base is in Brazil.

Second, Conectiva has been profitable for some time now, so this won't be exactly saving the Conectiva platform, as if it were dying.

Conectiva has some big corporate customers, including several banks. One of them is even using Conectiva Linux on their ATM machine. So I really don't understand why you wrote "customers" (using quotation marks).

Also, it is Conectiva, with just 1 N. Not Connectiva.

About what I think, is that people should do their homework before posting. Then again, this IS slashdot.

Re:What does MandrakeSoft gain?

[Simon]

What does the Mandrake distribution gain with this merger?

As far as I am concerned what Mandrake could gain from Connectiva is a move to apt-rpm and Synaptic.

huh? Mandrake can move to apt-rpm and Synaptic any time they want. They don't have to merge with Conectiva to do that! It's Free Software after all.

The merger has got little to do with software and technical features, and everything to do with getting entry to South American markets.

Besides, both are heading towards the SMART package manager.

--
Simon

Nice merge ...

[wagner_bila]

Well, i have Mandrake Community 10.1 installed on my linux box (my notebook) and i always heard good things about Conectiva and its developers. Since i'm also brazilian, i feel very greatful with the fusion ... i think some good products can be build now on with this merge. Also Brazil has a strong movement to the open source software and the open source initiative and also has a great potential to grow too ...