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Will McNealy Take Sun Private?
krygny writes "There is speculation that with $7.5 billion in cash, and liquidation of other assets, Sun could leverage a buyback of all publicly traded shares of SUNW at between $5 and $5.50 per share. I suppose, that would relieve them of Sarbanes-Oxley requirements, which Scott McNealy never really liked. (Who does?) For anyone at Sun who survives the tumult, hopefully, there could also be a return to the former corporate culture."
There's a lot of people that care about what happens to Sun, theres no need to flame just because you dont care about Sun.
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I, as an investor, think Sarbanes-Oxley is a Good Thing(tm).
Of course as a consultant I think it's friggin' awesome!
I've often thought that if I ever started a company, that I would vastly prefer to keep the company private. The requirements on public companies are so onerous that I just don't see how it is really worth it long term. It forces you to look at the short term only. And the expenses of stuff like Sarbanes-Oxley are just drains on productive company activities. (Talk about making the problem worse. Sarbanes-Oxley is nothing more than a cash transfer from productive company activities to public accounting firms and lawyers. ) The only time I can see going public is when I was ready to "cash out".
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This is one thing that bugs me. Sun's strategy is looking two and more years out, but the investors care only about the next three months. One advantage of going private would be getting those asshole analysts off their backs, I guess, but the costs might be too much. I'd much rather see them put that money into R&D. They have three CPUs in the pipeline now (USIIIi+, USIV+, Niagara), and getting them to market sooner is always a good thing.
CPA firms and recently graduated accounting students.
And employees who don't want their IRA/401K to disappear, shareholders who don't want to be used for their money, and customers who want what they pay for without getting ripped off.
Accountability and responsibility are good things.
SGI has too much cash. Novell has too much cash, Microsoft has oodles of cash. There are lots of companies that have this problem. If you spend cash to buy assets, those assets have to have a reasonably fast return or Wall Street will skewer the buyer.
In a less shaky economy, where your next dollar or euro or pound or yen or shekel of profit were clear, you'd be spending them. But it's not clear, because of lots of ennui in the market place. Corps are stagnating, playing only to Wall Street and their options packages, not to general stockholders. Their guts are gone. Now, entrepreneurship is found in the ASEAN countries, and in odd places like the Ukraine and Slovenia. These guys are afraid to move, not because of SarBox, but because of some dimwitted analyst who will roil when the price of oil climbs or when an earnings target is honestly missed by a shaved penny per share.
But this isn't a rant, it's an observation that control has been pulled from too many corps and handed on a platter to the speculators on the NASDAQ, and NYSE. Those bozos, who've helped ruin the economy along with the depravity of a weak dollar, are wreaking havoc. On the surface, a cheap dollar helps exports-- but deficits are at an all-time high! This is because the dollar is leaking out of the US economy at staggering rates into labor costs across the world. Soon the dollar is going to be like the lire. Get bigger wallets, which will hold far less.
---- Teach Peace. It's Cheaper Than War.
This would not change much about the company's situation. Sun's biggest weakness is that they're selling custom, 'high-end' hardware into a commodity market, all the while undermining that business with cross-platform Java. The ownership of the company won't change any of this. Thus, SUNW is a bad investement, even for Sun itself.
Now you could try to self-fund from the firm's income, but that won't happen quickly unless you are selling drugs.
Also note that your employees, the best ones, are constantly being lured away by the thought if stock options from a competitor. Compensation is important, and its easier to let the investing public do the heavy lifting.
Yes, because being the leader of the greatest military and economic power on earth and sending 130,000 troops overseas to attack a couple of countries on "misinformation" is far better than being well-aware of everything and simply lying about it to achieve your objectives.
Wow. Why was this guy marked flamebait? Sun was one of the staunches supporters pushing the whole "there's not enough qualified tech labor in America" thing in the late 90s that lead us to the situation we have today.
However, I don't think the "foreigners generally dislike documentation because it requires effective use of English" thing is at all accurate. Most overseas companies who have support contracts (which most anyone with a lot of Sun hardware will have) has people who speak fluent (or fluent enough) english. And nobody loves having everything documented - english or otherwise - than the Japanese. It's like, if it doesn't say it somewhere on an official piece of paper - it isn't right.
they say they'll go private and their stocks spike, they sell some stock and make alittle money
Really? Do you have any way to back that up? If so, some fine folks at the SEC would be deeply interested. Insider trading is just a wee bit illegal.