10 companies Apple could buy right now, with cash
So say you're Apple CEO Steve Jobs, and you're sitting on a boatload of cash that's burning a hole in your pocket. What to do with it? Combined with securities and other investments, that's about $75 billion in cash and cash equivalents. In actual cash -- you know, greenbacks -- it's $28.4 billion.
Just to show you the power Apple has right now with the amount of money it has, Betanews has put together a list of companies that Apple could buy right now, with just cash.
This means the company would be able to acquire without taking on any debt at all, or even selling off securities or liquidating other assets. Write a check. Such a position is obviously advantageous because the acquired entity is making money for you immediately rather than being used to pay off your creditors. It's a good position to be in.
Remember that in any buyout, the acquiring company will typically pay a premium to the stock price of the company its purchasing, and typically doesn't blow all its cash on one thing -- there is usually some type of financing. That said, Apple still holds a lot of power with the amount of cash it has lying around. What could it buy?
Yahoo - Market Cap: $17.2 Billion
The reasons why Apple would want Yahoo are few and far between, but look at it this way: each of the big three players would have their hands in the search market. Of course, there's the sticky situation of Microsoft's Bing powering Yahoo's searches: would an Apple owned Yahoo go back on its own?
Adobe - Market Cap: $13.8 Billion
It's no secret that Adobe's been a thorn in Apple's side for several years now. One popular way to get rid of that issue is a buyout. After all, creatives worldwide use Adobe's programs predominantly on Mac, so why not have Apple developing those apps? They could always deliver them over the Mac App Store then...
Netflix - Market Cap: $13.8 Billion
The idea of an Apple-owned Netflix probably makes the most sense out of the three we've listed so far. With the power of Apple behind it, Netflix's streaming offerings would probably get better (Apple has a lot of pull in the entertainment industry just because of its size), and a combined entity would have a ton of power (and customers). Then again, the industry hates both companies so you never know.
A Bit of A Stretch
Xerox - Market Cap: $13.2 Billion
Apple could undo all the talk about Steve Jobs stealing -- ah, borrowing -- Xerox's GUI way back when with a simple acquisition. Then again, there's little value for Apple here as anything that Xerox is working on right now is of little value to Cupertino.
SanDisk - Market Cap: $10.3 Billion
An acquisition on the level of SanDisk would give Apple leverage in the flash chip market. Increasing numbers of Apple products depend on flash memory chips, and it would no longer need to deal with competitors like Samsung. Then again, I doubt those companies would let something like this go through without a serious antitrust fight.
Research in Motion - Market Cap: $13.2 Billion
Lets face it, RIM is a company that's in deep doo doo. Its market share continues to fall and it has next to no traction in the industry with consumers. Even its enterprise and corporate base is increasingly abandoning it in favor of the iOS and Android platforms. That said, RIM still does have a few valuable technologies that could help Apple in the enterprise sector. The question remains though, would acquiring a distressed company falling out of favor really be a good investment? I'd think not.
Are You Kidding?
Best Buy - Market Cap: $10.3 Billion
The retailer and Apple already have a strong relationship through the Apple store-within-a-store program. Apple could expand its reach well beyond its company-owned stores with the purchase of a retailer like Best Buy. But why would it want to do this and sell the wares of its competitors? Or Windows PCs? Perish the thought!
Sony - Market Cap: $25.2 Billion
Sony's fallen on some hard times. Whether it be the month-long outage of its PlayStation Network, or the apparent lax security of its web servers worldwide, it's taken a toll on the company's overall valuation. An acquisition here could teach the company how to make money again. But there's absolutely no synergy at all between the two, and Apple's cash would be better spent elsewhere.
Symantec - Market Cap: $14.6 Billion
Apple has made its business out of poking fun at Windows users and their security problems. It could acquire a company like Symantec and make money off their woes, or maybe even get the company to start producing quality antivirus for Mac -- it apparently now needs it! Again, there's really no reason for Apple to acquire a company like this, and it would look kind of hypocritical don't you think?
Lockheed Martin - Market Cap: $25.7 Billion
We stuck this one in here for pure fun. Lockheed Martin is the darling of the defense industry and has some pretty valuable defense contracts with the US Government. At a market cap of about $25.7 billion, with a little maneuvering Apple could definitely afford it, even at the premium. Imagine the bombs that the company could build with the help of the designers in Cupertino...
Editors Note: All market valuations are current as of Friday afternoon, July 29.