5 ms·

This may answer the natural question of "why not just shut it down, rather than pay to have it taken over": > In a 10-year partnership, Globalfoundries wil

by psuter 12y ago

This may answer the natural question of "why not just shut it down, rather than pay to have it taken over": > In a 10-year partnership, Globalfoundries will supply IBM with Power processors in exchange for access to IBM’s intellectual property I suppose it's one way to cut losses while not sacrificing short-term access to the technology; after all, 1+ billion is "only" one year of losses, according to the article. An intriguing move in any case. I wonder if anyone can point to previous examples of a company paying to have a division acquired?

greglindahl 12y ago
It's very common for companies selling divisions to sign pre-purchase agreements. This article's title and tone are at odds with how normal this particular deal is.
- ghshephard 12y ago
  Thanks - that puts this in a new light. Based on what you are saying, this isn't purely "IBM Paying Someone $$$ to take off money losing division from their books" as it is, "IBM purchasing Processors, Chips, from Global Foundry, cost of such products being the net-worth of their manufacturing/engineering division + $1.5B"
currysausage 12y ago
> I wonder if anyone can point to previous examples of a company paying to have a division acquired? Siemens paid BenQ for absorbing their mobile phone business (Siemens Mobile became BenQ Mobile, using the BenQ-Siemens brand). One German news article [1] says that Siemens subscribed for new BenQ shares worth 50 million euros, while BenQ didn't have to pay anything (final paragraph). Another article [2] states that Siemens agreed to pay 400 million euros to BenQ by installments, but held back the last installment of 117 million euros following BenQ's shutdown of BenQ Mobile in Germany (second paragraph). [1] http://heise.de/-107908 http://heise.de/-107908 or https://translate.google.com/translate?sl=auto&tl=en&u=http%3A%2F%2Fheise.de%2F-107908 https://translate.google.com/translate?sl=auto&tl=en&u=http%... [2] http://heise.de/-131172 http://heise.de/-131172 or https://translate.google.com/translate?sl=auto&tl=en&u=http%3A%2F%2Fheise.de%2F-131172 https://translate.google.com/translate?sl=auto&tl=en&u=http%...
josephlord 12y ago
In most of the civilised world there are significant costs to just shutting down a business especially redundancy costs for staff. This is in addition to considering outstanding debt in the business being sold and makes zero or negative purchase prices sensible in many scenarios. I don't have a list but it doesn't strike me as at all strange or odd even where there is no ongoing commitment or contract between the companies as in this case.

by psuter 12y ago

greglindahl 12y ago

It's very common for companies selling divisions to sign pre-purchase agreements. This article's title and tone are at odds with how normal this particular deal is.

ghshephard 12y ago
Thanks - that puts this in a new light. Based on what you are saying, this isn't purely "IBM Paying Someone $$$ to take off money losing division from their books" as it is, "IBM purchasing Processors, Chips, from Global Foundry, cost of such products being the net-worth of their manufacturing/engineering division + $1.5B"

currysausage 12y ago

> I wonder if anyone can point to previous examples of a company paying to have a division acquired? Siemens paid BenQ for absorbing their mobile phone business (Siemens Mobile became BenQ Mobile, using the BenQ-Siemens brand). One German news article [1] says that Siemens subscribed for new BenQ shares worth 50 million euros, while BenQ didn't have to pay anything (final paragraph). Another article [2] states that Siemens agreed to pay 400 million euros to BenQ by installments, but held back the last installment of 117 million euros following BenQ's shutdown of BenQ Mobile in Germany (second paragraph). [1] http://heise.de/-107908 http://heise.de/-107908 or https://translate.google.com/translate?sl=auto&tl=en&u=http%3A%2F%2Fheise.de%2F-107908 https://translate.google.com/translate?sl=auto&tl=en&u=http%... [2] http://heise.de/-131172 http://heise.de/-131172 or https://translate.google.com/translate?sl=auto&tl=en&u=http%3A%2F%2Fheise.de%2F-131172 https://translate.google.com/translate?sl=auto&tl=en&u=http%...

josephlord 12y ago

In most of the civilised world there are significant costs to just shutting down a business especially redundancy costs for staff. This is in addition to considering outstanding debt in the business being sold and makes zero or negative purchase prices sensible in many scenarios. I don't have a list but it doesn't strike me as at all strange or odd even where there is no ongoing commitment or contract between the companies as in this case.