Identification When One Company Looks At Taking Essay

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¶ … Identification When one company looks at taking over another company that are many issues that must be looked at before a final bid can be put on the table. The first thing that the buying company must do is determine a vision for the combined companies. In the case of Oracles buy out of Sun Microsystems the visions that Oracles' Ellison was to transform the combination of the two companies into the Apple for the business customer by delivering high-quality, seamlessly integrated consumer products where software and hardware components were developed in conjunction, thus minimizing the customer setup process.

Ellison developed this vision by looking at what Sun Microsystems had that Oracle didn't and how would this acquisition help to better Oracles position in the market. If a company can buy another company at a practical price that has a unique niche in a particular industry it will more than likely try to do so. Once a niche is carved out, it becomes the opportune time for one company to start looking at another. In terms of both money and time, it is frequently cheaper for some companies to get a given product or a service than to make it from scratch. This permits them to keep away from the risk often associated with startup procedures.

The overall technology industry had traditionally been a strong one. The computer hardware market, which consists of personal computers, servers, mainframes and workstations, has become a necessity for both individuals and businesses, making the demand strong...

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Because competition has been weak the market had grown almost five percent over the last few years and is expected to continue to grow well through 2013. The software and services segment on the other hand, despite being the largest part of the IT industry has enjoyed many competitors over the years. The segment as a whole though has outpaced the hardware segment growing at a rate of almost thirteen percent. This segment is also expected to continue its healthy growth rate through 2013. The smallest segment of the industry, the computer storage and peripherals area, which includes data storage components, computer processors and other peripherals, is also inundated with competitors. Its growth rates have mirrored those of the computer hardware market and are also expected to continue to grow.
In the case of Sun Microsystems they had a niche in hardware and networking that Oracle wanted to join with their expertise in software. In this particular case, Sun also had some software applications that would go to Oracle. Oracle had to decide whether mixing the software application sales would do more harm than good. It was determined that since the software applications were geared towards different things and were not currently in competition with each other, that there would be no real detriment to any of them.

The next thing that needed to be looked at in this case was the price. When Oracle first began eyeing Sun they did not know that IBM was interested as well. If Oracle really wanted Sun…

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