LNUX is next.......Sun Micro to Buy Cobalt in Stock Deal
PALO ALTO, Calif. (Reuters) - Sun Microsystems Inc. (NasdaqNM:SUNW - news) said on Tuesday it would buy Cobalt Networks Inc. (NasdaqNM:COBT - news), a supplier of server appliance products, in a $2 billion stock deal.
Sun, a maker of computer servers and workstations, said in a statement that the deal would speed up its entry into the growing server appliance market and bolster its focus on network computing. Server appliances function like engines for the delivery of network-based services.
Under the terms of the deal, each share of Cobalt common stock would be converted into half a Sun share, with a total purchase price of about $2 billion, the statement said.
The acquisition would be accounted for as a purchase. It is expected to be completed during Sun's second quarter of fiscal 2001, which ends Dec. 31.
Sun said it expected the deal would add to earnings before interest, taxes, depreciation and amortization, gains on the sale of equity investments and in-process research and development charges for the second half of the fiscal year. |
