Entries tagged “Skype”
Insight June 30, 2011
Microsoft made the headlines on May 10, 2011, when it acquired videoconferencing giant Skype for a reported $ 8.5 billion. Following the antitrust procedure of the Hart-Scott-Rodino Act, the companies filed a pre-acquisition notification to the various government bodies, required before the deal can be finalized.
Insight September 02, 2009
On September 1, 2009, Ebay announced that it would sell 65% of Skype, an internet calling service to a group of investors which includes Silver Lake, a private-equity fund, and a venture-capital firm started recently by Marc Andreessen, founder of Netscape. The price was $1.9 billion in cash, higher than previously expected. Skype was purchased by Ebay in the year of 2005 and was targeted to strengthen the communication between buyers and sellers of Ebay.
The situation is not uncommon in the mergers of the technology companies. As early as in 2000, analysts had already pointed that the problem in the corporate alliance is especially rife in the tech industry, where executives working quickly on “internet time” often rush deals before assessing whether the companies fit well together. In order to determine whether the two companies match each other, merely prior transaction due diligence is not enough.
Reasons why some acquisitions fail, among other things, might be the unfitness of the technology developed by the acquired company to the acquiring company, corporate cultural clash, and disenchanted key employees of the acquired company who finally left the company. A competent law firm or lawyer can add value to the companies by doing adequate intellectual audit and designing an employment package to detain the key employees.