Perhaps it’s only speculation since rumors remain only rumors unless they are confirmed. But the fact that Moody’s Investors Service (MCO), only last week issued a negative outlook on Sun Microsystems (JAVA), combined with the aspect of a continued deterioration in co’s operating profile as result of falling sales and market share contraction – have prompted rumors that Schwartz’s Sun Microsystems might be a possible takeover target for acquisition by Hewlett-Packard (HP), Fujitsu or another tech giant.
Mercurynews is reporting that analyst Jay Lyman in a recent report for the 451 Group, a tech-industry research firm, wrote: “Sun is a large ship in mid-turn, and its low share price, technology and customers could make it an attractive target to some larger players.”
Layman alludes to several acquisition scenarios for the Santa Clara, CA-based company. Fujitsu being one. The co. has a history of partnering with Sun. In April of last year, Sun released the SPARC Enterprise server products, that jointly designed with the Japanese hardware giant. There is a possibility there that Fujitsu could see Sun’s acquisition as an expansion of its business into similar markets.
Hewlett-Packard (HP), is another possible candidate notes Layman – which also sells servers, and might see additional value in Sun’s portfolio of open-source software. That includes Java programming language and the MySQL database program, which is used by many large businesses.
Over the last year, Sun has seen its stock value drop by 45% and has experienced repeated rounds of layoffs. The company cut approx. 5,000 jobs during fiscal ’06. Recently it said it plans to let another 1,500 or more go.