Apple CEO Might Go In for Deals in Post-Jobs Scenario

August 29, 2011, By Sanjeev Ramachandran

Apple under Steve Jobs was not a big fan of merger and acquisitions. We all know that, right? The company has spent less than $1 billion on M&A deals over the past decade. But are things going to change?  There are ton of reasons to believe it just might. In the post-Jobs scenario, Apple’s new CEO Tim Cook (in picture) could be handed a $28 billion war chest to make acquisitions.

That could mark a departure from Steve Job’s tenure where big M&A deals were rare. It is believed that that former COO Tim Cook may be tempted to make some deals in areas such as entertainment patents and security to keep rivals at bay.

Arvind Malhotra, an associate professor of the University of North Carolina and a leading Apple strategist has been quoted as saying:

“…the time will come for acquisitions for sure. Jobs always grew from within. If lack of his vision and the availability of his position cause the future pipeline not to be there, that’s when an acquisition model comes into play. They are sitting on a cash pile”.

That could also mean that Apple might now need to spend more money acquiring products to now replace those built using Job’s ideas.

Apple had spent $1 billion on deals at a time when their largest rivals in the US had spent $15 billion on an average to buy companies.

It has been pointed out that Microsoft has lost a fifth of its value over the last decade after spending ten times as much as Apple on acquisitions. But Apple is now at a race to the top, vying with Exxon Mobil to be the most valuable company in the world.

Apple seems to have nothing to say on what the experts say, as usual. What is your take on this?

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