Going Private Is The New Public… Again

from the being-in-the-black-is-the-new-black dept

After years of companies vying to go public, it seems that the latest trend is to go private. Hot on the tails of the DoubleClick buy-out, Sun’s McNealy considers taking Sun private. With $7.5B in cash reserves and a $11.62B market cap, it may be the right time to try a leveraged buy-out (LBO). To do so would afford Sun the flexibility to execute on longer term strategic plans without having to answer to the quarterly spotlight of the street. Seagate went private in 2000, and since then was able to remake themselves, going back public in 2004. The big question for Sun is: sure, an LBO may be a good first step, but what second step will it realistically allow to help struggling Sun succeed? From new business models, to hosted grid computing, to trying to get silly software patents, it’s not clear Sun knows what that second step is.

Update Scott McNealy has publicly dismissed the buyout as an unsubstantiated rumor, suggesting a hedge fund is trying to drive up the stock. Of course, McNealy could just be driving the price back down in preparation of a buyout…

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