Your SlideShare is downloading. ×
  • Like
Giora Yaron  M&A To Be Or Not To Be
Upcoming SlideShare
Loading in...5

Thanks for flagging this SlideShare!

Oops! An error has occurred.


Now you can save presentations on your phone or tablet

Available for both IPhone and Android

Text the download link to your phone

Standard text messaging rates apply

Giora Yaron M&A To Be Or Not To Be


The Big Boys Playground 12.7.2011

The Big Boys Playground 12.7.2011

Published in Technology , Business
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Be the first to comment
    Be the first to like this
No Downloads


Total Views
On SlideShare
From Embeds
Number of Embeds



Embeds 0

No embeds

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

    No notes for slide


  • 1. M&A“TO BE OR NOT TO BE?” Dr. Giora Yaron
  • 2. M&A Experience base Comsys I; Sold to Conexant 1996 Pentacom; Sold to Cisco, 1999 P-cube; Sold to Cisco 2004 Mercury; Sold to HP 2006 Qumranet; Sold to RedHat 2009 2
  • 3. M&A Key consideration;Maximizing Share Holders Value Breadth of product portfolio Competitive landscape Market segment Maturing? Exploding? [Scitex/Creo/Kodak] Disruptive technology emerges [Kodak films, Galileo/Marvell] Founders desire 3
  • 4. THE EMOTIONAL QUESTION Do I want to sell or take it all the way? 4
  • 5. THE TWO SIDES OF M&AAcquirer view Defensive; control product transition (Rockwell/Comsys) Catch-up strategy; “On the fly fix” for a strategic miss (Cisco/P-cube, Qumranet/RedHat) Strategic response to deliver 1+1>2 (HP/Mercury)Seller view Defensive; competitive new technologies, market changes [Rockwell/Comsys, Cisco/P-cube, Qumranet/RedHat] Quick liquidity 5
  • 6. ACQUIRER VIEW; DEFENSE PLAY [ROCKWELL/COMSYS] CPU processing power increases HW enhanced instructions can be done in SW No need for HW modem Rockwell market leader (70% market share) in HW modems. Comsys technology threatens hundreds of millions of Rockwell revenueRockwell acquires Comsys to control market transition 6
  • 7. CATCH-UP STRATEGY; CISCO/P-CUBE P-cube develops Deep Packet Inspection [DPI] for next generation networking systems P2P takes the market by a storm Cisco has a hole in its product offeringCisco acquires P-cube to meet market need “on the fly” 7
  • 8. CATCH-UP STRATEGY; REDHAT/QUMRANET Qumranet develops Hypervisor for Linux RedHat market leader for Linux has no virtualization strategy The compute world is going vitrualRedHat acquires Qumranet for its KVM Hypervisor 8
  • 9. STRATEGIC MOVE;1+1>2 (HP/MERCURY)HP Openview has wide acceptance inthe data center mgt market, butcompeting hard against IBM TivoliMercury “owns” BTO market(performance analysis infrastructureand application) HP acquires Mercury; 1+1>2 9
  • 10. BIG COMPANY; UNIQUE CONSIDERATIONS Breaking the $1B revenue barrier Customers pushing for “end to end” solution Must increase number of deals at the $10m- $25m level Must go global rather than national Must develop global support infrastructure Must develop global IT infrastructureConclusion; Expend via acquisitions or be acquired 10
  • 11. “VALIDATION POINT” Mercury sold to HPStock shoots overnight from $34 to $52!! Largest acquisition in the history of the country!!! 11
  • 12. Considerations to insure successful M&A Considerations Strategic fit Product portfolio fit Company DNA Case studies Conexant/Comsys Cisco/P-cube HP/Mercury RedHat/Qumranet 12
  • 13. VALUATION DEFLECTION POINTS Technology feasibility; up to $100m (Pentacom, Qumranet) Market traction; up to $250m (P-cube) Customer base; up to billions (Mercury) 13
  • 14. ALL THE WAY VS. M&A THE ISRAELI PERSPECTIVE Historically had no mgt infrastructure to go all the way; No more!! Historically US lead innovation in all technology segments; No more!! Historically US market were first to adopt new technology; No more!! Today more than ever before IsraeliBased companies can go “all the way” 14
  • 15. 15
  • 16. THANK YOU! 16