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Reports Claim IBM Is Close To Sun Buyout

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Sun has agreed to accept a lower price in return for stronger commitments from IBM that it will complete the deal even if it faces intense regulatory scrutiny, according to reports

IBM is apparently closer to closing a deal to acquire Sun Microsystems after negotitating down the per-share price from between $10 (£6.8) and $11 per share to between $9 and $10, the Wall Street Journal reported on 2 April

Apparently, Sun has agreed to accept the lower price in return for stronger commitments from IBM that it will complete the deal even if it faces intense regulatory scrutiny, the Journal quoted its sources as saying.

Lawyers for IBM have been doing extra due diligence around the clock for the last two weeks since the intended acquisition first broke into the news on 18 March.

Sun still has an IP lawsuit on the books around ZFS (Zettabyte File System for open storage) going against NetApp, and those details have to be worked out to the possible new owner’s satisfaction.

There also are many customised licensing arrangements to iron out with customers who have both IBM and Sun products and services under SLA.

In short, there are numerous complications to such an acquisition, so the lawyers — including the celebrated IT intellectual property firm Wilson, Sonsini & Goodrich of Palo Alto, Calif. — are in the driver’s seat at the moment.

As soon as a decision on the deal is reached, eWEEK Europe UK will have full coverage of the news and of its impact on the enterprise IT market.