3PAR Overbidding Is a Sign of Cookie Cutter Dell Strategy

One of the things that was so thrilling about Dell’s early business strategy was how clear and simple it was.  Dell built high-quality but essentially commodity computers faster and cheaper than anyone else and developed superior supply chain and order taking processes that took years and years for competitors to even approximate.  Looking at Dell and HP’s bidding for 3PAR recently, I think M&A run amok like this usually means the companies involved don’t have a lot of other strategy ideas to execute.  It’s a shame to see Dell trying to buy growth now in contrast to their early strategic clarity. Continue reading 3PAR Overbidding Is a Sign of Cookie Cutter Dell Strategy


Hope for Novell

The software industry is commonly known as a winner-take-all arena.  Because of network effects and the huge economies of scale in the industry, the leader in a given category usually takes most of the profits.  Think Microsoft in office productivity software, Oracle in databases, and Google in search.  It’s not a hard and fast rule, of course, but being an also-ran in the software industry is usually a lonely and frustrating experience.  Novell, which sells its own distribution of Linux as well as workgroup, security, and systems software, has become familiar with that position over the last few years.  But now a $2 billion acquisition offer from hedge fund Elliott Associates suggests there may be more potential in the company than people think. Continue reading Hope for Novell


Puzzling Merck and Millipore Deal

Over the weekend, Merck KGaA of Germany (not to be confused with the bigger Merck Inc.) put in a $7.2 billion bid for Millipore, a maker of life sciences research products, beating out an earlier offer of $6 billion by Thermo Fisher Scientific.  I’ve done some consulting work in the life sciences sector, but I don’t follow it closely.  Even so, this transaction puzzles me, so I decided to spend some time thinking about it further. Continue reading Puzzling Merck and Millipore Deal