Two announcement broke the boredom of the markets pull-back this morning. (The pullback is itself a reaction to the "irrational exuberance" in financial stocks of the past 5 weeks since low reached on March 9. The investment banks earnings results are showing "Profits" - but are just excluding the mark-to-mark "reality" of loan losses since those rules were relaxed in Q1.)
1) Alberta Investment Management (aka AIMCO) - recently independent of the provincial government treasury on Jan 1/2008 - announced it has made a 10% equity investment in Precision Drilling Income Trust (PD.UN C$4.50) as well as C$100 million debt purchase. The denial quoted just serves to reinforce the obvious - there is now a new strategic player in western Oil & Gas stocks. The recent merger between SU & PCA was likely another product of this new alignment of the sun and stars.
It takes me back to the good ole' days of Socred prairie populism when we had Vencap and BRIC. Who knows where this can lead. Favoured son, SCL.B Shaw acquiring T when it gets into trouble when it can't manage the exit from POTS business? Epcor+Enmax? Strategic investment by CCO in TA and CU to build power plants and grid to supply Washington state? The possibilities are endless.
2) ORCL is acquiring IBM-spurned SUNM at US$9.50, only 10c above the rejected price. A tech blog I read (Dane GARDNER) can't be more effusive about the strategic consequences of the purchase. I agree, it was more or less inevitable after IBM walked. I also think that GARDNER's suggestion of HP picking up the hardware side of SUNW is a "done deal" once the smoke clears.
As this deal is as good as done, it is much more interesting to speculate about what this does to remaining competitive landscape within IT. MSFT's Balmer's feigned surprise is probably concealed frustration as his life just got tougher having missed the SUNW boat. I believe the most likely major target for IBM will now be SAP, especially as the European slowdown I plays out.
Amid other speculation, this newsbyte last week that MOT will be building a set-top TV box for Google Android (GoogleTV to be created by Motorola) suggests a strategic alliance made in engineer heaven. These two bloodlines are made for each other, the R&D can stay with GOOG and manufacturing can be sold off to NOK or Samsung/LG. As Nortel is bankrupt, it's remains can be acquired by CSCO or Alcatel/Lucent can pick up the remaining pieces. That spells the end of the Telecom Equipment era.
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