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Discussing a Private Buyout of Microsoft

Posted by ryuzaki0 on from the that's-quite-a-deal dept.

PatriceVignon writes "Are private buyout companies setting their eyes on Microsoft? The Financial Times claims exactly that in an article called 'Private equity folk could do wonders with Microsoft', as ZDnet reports: 'Consider Microsoft, which has a balance sheet so inefficient that it would make a private equity investor weep ... The new management could take the axe to Microsoft's $6.6bn of wasteful research and development expenditure. The bloated workforce of more than 60,000 could be slashed, to the point where the huge resulting increase in cash flow would at last permit the company to borrow mega-billions.' Business Week, though, begs to differ: 'practically speaking, it's not going to happen,' and quotes Daniel Primack: 'Snakes on a Plane will win a best picture Oscar before Microsoft gets acquired by LBO firms.' What do you think?"

6 of 315 comments (clear)

  1. Snakes on a Plane will win a best picture Oscar by Anonymous Coward · · Score: 5, Insightful

    If Titanic can get one, anything is possible.

  2. private equity not long-term by nicolaiplum · · Score: 5, Insightful

    Microsoft's R&D spending might make a private equity investor weep, but private equity investors are around to buy distressed or underperforming companies, make them lucrative, and sell them. They don't care about long-term R&D or having a product pipeline further out than when they cash in their investment by selling the company.
    Of course you could starve and loot Microsoft and make a lot of money, but only if your plan is to dispose of the carcase before it begins to rot.

    --
    "For a successful technology, reality must take precedence over public relations, for Nature cannot be fooled"
  3. Wha? by The+Angry+Mick · · Score: 5, Insightful
    The bloated workforce of more than 60,000 could be slashed, to the point where the huge resulting increase in cash flow would at last permit the company to borrow mega-billions

    Some private equity firm thinks Microsoft, one of the richest companies in the world, would be better off borrowing money?!? I thought capitalism was about maximizing profit. When did things change?

    I guess I really need to brush up on my economics . . .

    --

    I'm not tense. I'm just terribly, terribly, alert.

  4. Is This a Joke? by susano_otter · · Score: 5, Insightful

    How does cutting R&D and the workforce = good business plan?

    And why would Microsoft need to borrow "megabillions" anyway, let alone at the cost of their workforce and R&D?

    --

    Any sufficiently well-organized community is indistinguishable from Government.

  5. Re:And then... by dslauson · · Score: 5, Insightful

    Seriously. I can't stand people who call having a big R&D budget wasteful. There are a lot of things I don't like about Microsoft, but spending money on Research and Development isn't one of them. I'd rather see them spending money there than just lining the pockets of investors.

  6. On Surprises by panaceaa · · Score: 5, Insightful

    I wouldn't be surprised if that film actually wins best film.

    Are you a constant victim of practical jokes or something? Do people pop-out from behind corners and scream "AHHH!H#$!" five times a day? Does your girlfriend leave out pregnancy tests in the bathroom with two lines hastily drawn with a Bic pen? I'm guessing so. Dave, for your own sanity, fix your life so that if SoaP wins Best Picture it surprises you!!!

    --
    my blog