Sorry, LinkedIn: The 11 biggest tech mergers in history almost all had terrible endings

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Microsoft

The new era of the tech supermerger is upon us.

In fall 2015, Dell bought EMC for $67 billion – the biggest pure-technology merger and the second-biggest tech deal ever.

In June, Microsoft shelled out a whopping $26 billion for LinkedIn, making it the priciest company the tech titan has ever bought.

Silicon Valley figures like investor Marc Andreessen and Salesforce CEO Marc Benioff think it’s a sign of things to come.

But while LinkedIn CEO Jeff Weiner might be enjoying his champagne, it might be time to take a walk down memory lane and remember the ghosts of mergers past. Only a few were winners. The rest resulted in depressed share prices, corporate confusion, and layoffs.


11. Oracle-BEA. Oracle is actually pretty good at acquisitions. When it acquired BEA for $8.5 billion in January 2008, Oracle got the WebLogic software that still powers its Fusion Middleware product for developers.

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Justin Sullivan/Getty Images

10. Compaq-DEC. Compaq snapped up Digital Equipment Corp., a company that had been making computer servers since the 1960s, for $9.6 billion in 1998. DEC was slow to recognize that the PC industry was taking off.

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Wikimedia Commons

By the time of the acquisition, DEC was a stagnating company with high operating costs and few desirable products — problems that Compaq inherited after the merger.

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Former Compaq CEO Michael Capellas.
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Getty Images/Brett Coomer

9. Symantec-Veritas. In 2005, antivirus giant Symantec sought to buy data-storage company Veritas for $13.5 billion. The plan was to become a one-stop shop for storing and protecting corporate data.

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AP/Marcio Jose Sanchez

Investors hated the deal and bid Symantec’s price down, so the final deal was actually worth only $10.5 billion. After a decade of disappointment, Symantec sold off Veritas for $8 billion in summer 2015 in a leveraged buyout deal.

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Former Symantec CEO John W. Thompson.
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Getty Images/Justin Sullivan

8. Oracle-PeopleSoft. The road to Oracle’s $10.3 billion acquisition of HR software provider PeopleSoft was fraught with drama. Oracle made two hostile-takeover bids, which were declined, before the US Department of Justice stepped in with antitrust concerns.

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Wikimedia Commons

Finally, in November 2004, the deal closed. PeopleSoft is still a part of Oracle’s product portfolio today.

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Justin Sullivan / Getty Images

7. HP-EDS. Electronic Data Systems was founded in 1962 by businessman and eventual US presidential candidate Ross Perot. It provided IT-services outsourcing for lots of companies.


HP bought EDS in July 2008 for $13.9 billion to form the cornerstone of its HP Enterprise Services unit. That unit has suffered regular layoffs from the time the deal closed. In May 2016, HP Enterprise announced it would sell the unit to archcompetitor Computer Sciences Corp., forming a new joint venture with them.

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HP Enterprise CEO Meg Whitman.
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Business Insider

6. JDS Uniphase-E-Tek. In June 2000, right at the crescendo of the dot-com boom, optical technology company JDS Uniphase bought E-Tek Dynamics, which made optical networking components, for $15 billion.

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Lumentum

Like a lot of other companies of that era, JDS Uniphase was hit hard after the bubble burst, but it stuck around until it broke into two smaller companies this past summer.

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Flickr/Edward Spiegel

5. VeriSign-Network Solutions. Here’s another relic of the dot-com era. In March 2000, email security company VeriSign bought domain registrar Network Solutions for $20.8 billion. Network Solutions didn’t only sell domain names — it was also the body in charge of overseeing the .com, .net, and .org top-level domains.

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Verisign via YouTube

But VeriSign ended up having to sell off its domain-name registration service in the wake of charges that VeriSign violated the law by essentially tricking people to going to its website. If you mistyped a website name, VeriSign would automatically take you to a bunch of ads.

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Chip Somodevilla/Getty Images

4. HP-Compaq. Under the leadership of former US presidential candidate Carly Fiorina, HP snapped up PC manufacturer Compaq for nearly $19 billion in 2002.

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Reuters

At the time, HP was struggling with its PC business, and so was Compaq — at least partially because of the complexity involved in the DEC merger. The result was a disaster of an acquisition, with over 30,000 HP employees laid off soon after.

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REUTERS/Mary Schwalm

3. Microsoft-LinkedIn. This is where Microsoft and LinkedIn come in, with their $26.2 billion deal. It’s still a big question mark, but Microsoft has big plans to bring Office and the LinkedIn professional social network closer together. We’ll see how it plays out.

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Microsoft

2. JDS Uniphase-SDL. JDS Uniphase was a merger machine. In July 2000, right after the E-Tek deal, it also bought component-maker SDL for $41 billion. These days, JDS Uniphase is broken into two companies: optical-tech maker Lumentum and network-services consultancy Viavi.

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Viavi

1. AOL-Time Warner. The big one. In January 2000, AOL bought Time Warner for $181.6 billion in a move that was supposed to establish the internet service provider as a media giant.


That never happened, and in 2009, Time Warner spun AOL back off as an independent company worth about $3 billion. The biggest deal of all time turned into a bust.

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Getty Images/Spencer Platt