A tarnished Golden Tombstone

Contact: Brenon Daly

In each of the past nine years, 451 Research has surveyed more than 100 corporate development executives to find out which deal announced during that year stood out to them as the most significant transaction. The peer-selected prize, which we call the Golden Tombstone, has gone to companies across the tech landscape. Still, many of those blockbuster transactions haven’t generated the expected returns. The Golden Tombstone, it turns out, can tarnish over time.

We saw that yet again this week, as Intel unwound its full ownership of McAfee, which was voted the most significant transaction of 2010. With that divestiture, the number of Golden Tombstone-winning transactions that have been undone climbed to three, representing an alarming one-third of the annual prize winners. (The others: Hewlett-Packard Enterprises sold off its services business in May, reversing its 2008 acquisition of EDS; and Google unwound its 2011 purchase of Motorola Mobility three years later.) For the record, the ‘exit’ prices for all of those businesses was far less than the ‘entrance’ prices.

Not to jinx the transaction or anything, but we would nonetheless note that last year’s landslide winner was Dell’s acquisition of EMC. That transaction, which was announced last October and officially closed earlier this week, was an obvious vote for the Golden Tombstone. After all, it is the largest pure tech transaction in history. And yet, even though Dell and EMC are only (officially) beginning their corporate life together, there’s already some ominous history lining up against the deal.

Top vote-getter for ‘most significant tech transaction’

Year Deal
2015 Dell’s acquisition of EMC
2014 Facebook’s acquisition of WhatsApp
2013 IBM’s acquisition of SoftLayer
2012 VMware’s acquisition of Nicira
2011 Google’s acquisition of Motorola Mobility
2010 Intel’s acquisition of McAfee
2009 Oracle’s acquisition of Sun Microsystems
2008 Hewlett-Packard’s acquisition of EDS
2007 Citrix’s acquisition of XenSource

Source: 451 Research Tech Corporate Development Outlook Survey

For more real-time information on tech M&A, follow us on Twitter @451TechMnA.