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Sunday, October 30, 2005
Tired of Sun Microsystems' inability to reach the status enjoyed in its glorious of the Internet boom, its stockholders voted to repeal the poison pill provisions in place to make it hard for a hostile bidder to take over the Santa Clara company.The proposal to eliminate a poison pill gained 84 percent of the vote at Sun's annual shareholder meeting, despite the opposition of the Sun board. A poison pill is a weapon used by corporate boards to block a hostile takeover attempt, by flooding the market with new shares in order to prevent a bidder from acquiring a majority of the stock. The vote is not binding on the board, but one analyst said the result underscores the discontent among Sun shareholders and sends a signal that they are "in a selling mood." The executive compensation strategy also has strong opposition before being voted for. The stockholders all but begged a knight, black or white, to come in and take over the company, said one analyst. Sun is in serious trouble, the sooner it finds a suitor, its better for all. Besides Sun hardware LOB underperforming seen over a period of time, its software LOB is in dismal shape – recent announcements and acquisitions not withstanding. Even in emerging areas like RFID, Sun is beginning to be seen as talkative company as against a thought or market share leader – with almost no bright spark left within to fuel growth. Gateway which had strong financial results might be interested in Sun at the right price – while sad to see sun slipping, that’s the way life has got to be – consistent underperformers serve better interests by winding up or be allowed to be bought.
|Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld