Easily digestible tech news... http://www.techdirt.com/ en-us http://www.techdirt.com/images/td-88x31.gifhttp://www.techdirt.com/ Mon, 20 Aug 2007 15:35:07 PDT Joseph Weisenthal http://www.techdirt.com/articles/20070820/082927.shtml http://www.techdirt.com/articles/20070820/082927.shtml VMWare's meteoric IPO, Citrix Systems announced the acquisition of Xensource, confirming that virtualization mania was in full swing. Of course, as when any area gets this hot, you have to figure that the IT majors will want in on the action. Wall Street analysts are now speculating that Microsoft may make a competing bid for Xensource or possibly acquire it through an acquisition of Citrix itself. Should that happen, IBM may feel the need to make a move of its own, although for now it's all rank speculation. Either way, we do know that Microsoft is definitely interested in the virtualization space. A New York Times article from earlier this year discussed the potential rivalry between it and VMWare, noting that it could attempt to beat it back by bundling the technology into a future version of Windows (sound familiar?). In the past, Microsoft has been conservative about dipping deeply into its cash horde to take on new markets. But as its recent purchase of Aquantive indicates, it will strike fast when it starts to feel threatened.

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]]> are-they-on-the-guest-list? http://www.techdirt.com/comment_rss.php?sid=20070820/082927 Wed, 15 Aug 2007 07:52:51 PDT Joseph Weisenthal http://www.techdirt.com/articles/20070815/073323.shtml http://www.techdirt.com/articles/20070815/073323.shtml total coincidence, but just one day after EMC subsidiary VMWare skyrocketed in its market debut, software maker Citrix systems has announced the purchase of Xensource, a privately held maker of virtualization technology. It's hard to say whether Citrix got a good price on the $500 million deal, but considering the timing, you have to figure that Xensource was able to attract quite the premium. As Paul Kedrosky noted yesterday, the VMWare IPO seemed likely to spur the hunt for more such deals. Who knew things would get kicked off so quickly?

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]]> coincidence? http://www.techdirt.com/comment_rss.php?sid=20070815/073323 Tue, 14 Aug 2007 13:42:34 PDT Mike Masnick http://www.techdirt.com/articles/20070814/124357.shtml http://www.techdirt.com/articles/20070814/124357.shtml VMware's public offering. VMware shares priced at the top of their range at $29/share, but opened this morning at a whopping $52/share. VMware, of course, was supposed to have been one of the potential hot IPOs in the class of 2004, but decided to accept a buyout offer from EMC instead. This turned out to be a great decision, as the company has grown a tremendous amount under EMC, and today's IPO is for a much more substantial VMware than we would have seen three years ago.

However, since there are plenty of folks who probably weren't around during the last bubble to learn this lesson, it's important to remind everyone why first day stock pops like VMware's are not a good thing, and certainly not something worth bragging about. The difference in price is actually an indication of how much money VMware left on the table. Yes, the company raised nearly a billion dollars by selling shares at $29, but it missed out on the money it could have taken if the shares had been priced closer to the $52 the market has clearly valued its shares at. In other words, it sold all those shares at about 55% of what the market valued the company at. Not such a great thing to brag about now. Of course, there are some advantages to having the first day pop. It does act as a PR mechanism, and it certainly does bode well for VMware if they want to sell more shares to raise more money. However, right now, it certainly looks like the company left approximately $750 million on the table that was snapped up by those trading the stock, rather than the company itself.

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]]> ipo-madness http://www.techdirt.com/comment_rss.php?sid=20070814/124357