"maintain operations independently of Ctrip"
An acquisition not to improve either companies products then: so what gain to whom?
Skyscanner, the Scottish travel search business, has been acquired by Chinese competitor Ctrip in a deal valued at £1.4bn. The Edinburgh-based business, which was founded in 2001, will maintain operations independently of Ctrip, China's largest travel search business, which was founded in 1999. Expected to close by the end of …
Skyscanners owners' interest is obvious indeed.
But what benefit to Ctip, if indeed operations are kept separate? Either the "separate" bit is just fluff or the acquisition should have been by investors (who may or may not be very similar to those that own Ctip).If they have more cash than they can usefully reinvest, then pay dividends and let their shareholders decide where the cash should be reinvested (if at all).
When companies buy other companies without the intent of integrating them, (typically because they want to broaden their base for greater stability or to reduce market competition), they stifle market-led evaluation of their core product and so stop the ability of markets to move capital from bad companies to good ones. Thus grow overly-large monolithic shoddy companies with market-distorting power that provide little-to-no market/social/customer benefit.
If you have two different companies that service two completely different markets and both are profitable, why would you bring them together?
The only reason would be if you think you can leverage economies of scale. but considering regulations in europe on data protection, I'm sure Ctrip decided not to open that can of worms by bringing the skyscanner servers to China. So now Ctrip collect the profits from Skyscanner, so they make Money back on the purchase and they have a profitable subsidiary making money in a market they arent in or trying to get into.
Seems a very reasonable basis to do the deal for me.
"Thus grow overly-large monolithic shoddy companies with market-distorting power that provide little-to-no market/social/customer benefit."
Wow - that's a mouthful when "bank" would do! ..... defiler
Banks do extremely well and it is a better beta whenever it is understood and IT realises them also as a virtualised product/production/presentation, thus do sysadmins morph and evolve the grow into a territory/virtual terrain team/elite executive order operation with a temporary stop-gapping existentialist threat/treat for overly-large monolithic shadowy companies with spooky market-distorting power that provides benefit to everything and anything befitting of social customer markets/bourses/proprietary intellectual property exchanges/sensitive secret storage ..... secure banking.
* And that is a Skin IntelAIgent Source to a Right Royal Force with Surreal Cosmic Leadership .... Guided Guardianship.
Now...... prove to me and all who be sailing and surfing here on El Reg that all of the above is true/not true, and in so doing deny the fool their blunt tools of ignorance and oppression, austerity and conflict via the simple act and application of deep minded thought freely shared for peer review?
Go on. Take the Jump and Quantum Leap. Who Dares Win Wins.
This Greater IntelAIgent Game was brought to you by GCHQ ICEnterprises.... an ESPecial Agency Future Portal Device.
[This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results may differ significantly from management's expectations. These forward-looking statements involve risks and uncertainties that include, among others, risks related to potential future losses, significant amount of indebtedness, competition, commercial agreements and strategic alliances, seasonality, potential fluctuations in operating results and rate of growth, foreign exchange rates, management of potential growth, system interruption, international expansion, consumer trends, inventory, fulfillment center optimization, limited operating history, government regulation and taxation, fraud, and new business areas.]
That's the way to do it ...... sell off proprietary intellectual property and time and space sensitive know-how to inspirational cash rich aspirants with more sense than to just wonder about how everything works better than just normal and as per usual.
:-) I wonder if Hammond's /the UK's newly reannounced £2billion per annum investment will be able to compete and win win against the Exotic Erotic Eastern Mind Mining Set?
Yesterday Hammond in the Autumn statement said there was a "longstanding problem of our fastest growing technology firms being snapped up by bigger companies, rather than growing to scale".
However five months ago he said "Britain is open for business" as he did when the ARM takeover was announced.
What's it going to be today? Who can tell.
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Yes, the ARM sale should have been examine by the government first IMO given it was one of the UKs star tech companies, if not THE one. But the real blame lies in the greedy directors and/or shareholders who need to take a good long hard look at themselves in the mirror. There is absolutely no reason to agree to sell a growing healthy company in profit other than to make a fat wedge for yourself. None.
"Don't know the details of this latest one, but hopefully the grunts will get a slice too."
Dream on. And even if they did, I doubt somehow a few hundred quid really makes up for the uncertainty that now hangs around jobs at ARM in the UK. If you don't think that Softbank may start to move all the R&D over to Japan at some point if its cheaper for them then you're VERY naive.
""Don't know the details of this latest one, but hopefully the grunts will get a slice too.""
It happens. I was a grunt at an American company bought out by a competitor.
Most of us had bought stock - some of us a large amount of stock - as part of our retirement plans.
Any amount we contributed to that plan was matched by our employers, so we essentially doubled our money there right there.
During the buyout, that stock was bought at over 50% above it's previous market value, so many of us did see a good deal of money. By a good deal, I mean thousands or hundreds of thousands of dollars. I was in the latter group, along with a good many other "grunts". Don't know if this scenario would play out in another country.
'Don't know the details of this latest one, but hopefully the grunts will get a slice too.'
I had an interview at skyscanner in 2007 (when they were in a small townhouse in Leith). they seemed an interesting place to work and they spoke about employees sharing in a potential flotation the following year (though that evidently didn't happen). no idea whats happened to them as they have got bigger but hopefully the core staff have got something out of it.
There is absolutely no reason to agree to sell a growing healthy company in profit other than to make a fat wedge for yourself. None.
Owners of a company can do whatever hey want with it. Its their company to do as they please. They can shut it down or sell it if they wish.
Given that (at least so far) the company will continue to trade independently there is nothing really to whinge about. I'm guessing the buyer will be satisfied with collecting the profits. At least for now.
"There is absolutely no reason to agree to sell a growing healthy company in profit other than to make a fat wedge for yourself."
No shit Sherlock - Money is the reason anyone agrees to sell anything. Either because you need the money not the thing or you think you are being offered more than the thing is worth.
It would have been OK with you to sell ARM if it was failing and loosing money?
"No shit Sherlock - Money is the reason anyone agrees to sell anything"
Actually Watson, there are other reasons to sell a company other than to make money for yourself. Perhaps go get a clue before posting.
"It would have been OK with you to sell ARM if it was failing and loosing money?"
Yes, because being bought out and saving the jobs is preferable to it going bust and everyone being thrown on the dole. Now hurry along, your next lesson is starting sonny.
> Perhaps go get a clue before posting.
> Yes, because being bought out and saving the jobs is preferable to it going bust and everyone being thrown on the dole
How many unprofitable companies do you own, exactly? I trust you are the first to go to the bank and remortgage your house when someone else's job is in danger, right?
> Now hurry along, your next lesson is starting sonny.
Now mate, being as thick as you are it is OK to ask questions. It's even OK to make idiotic pronouncements, so you can learn from them. But you really are not in a position to play the patronising card with anyone.
"How many unprofitable companies do you own, exactly? I trust you are the first to go to the bank and remortgage your house when someone else's job is in danger, right?"
I take back what I said about you getting a clue, I think you need to sober up first.
Plenty of company owners invest their own money or bank loans secured on a stake in the company or property (essentially re-mortgaging it) into their company to keep it afloat during rough times. Perhaps if you knew anything about the business world and weren't obviously some clueless arrogant student you might know this.
And FYI I've run 2 small companies in my time.
"Now mate, being as thick as you are it is OK to ask questions. It's even OK to make idiotic pronouncements, so you can learn from them. But you really are not in a position to play the patronising card with anyone."
Yeah, but you're not just anyone "mate", you're a contender for this weeks muppet award.
I cannot see how they do not fit together, SkyScanner do a decent enough job on worldwide flights, but like all non Chinese companies, have limited information on internal flights.
(They may show one, or even no internal flights when there are actually dozens).
Ctrip is WONDERFUL for internal Chinese flights, but once you cross the border they lose the plot.
Bolt the two together, and in theory you should be able to book through from any obscure Chinese city with an airport to anywhere in the world, and vice versa.
As long as the prices are good, I for one, will welcome this; until now it has been a PITA researching external flights with one company and trying to match them up with internal flights from the other.
I was introduced to Skyscanner by a work colleague in the early 2000's - so presumably soon after it was launched. Pretty unimpressed at the time.
Then in early 2014 I needed to book a (business) flight to Barcelona - I tried Skyscanner after a couple of work colleagues said that was how they have been arranging flights. Wow.. impressed.. took me though to a ticket agency and I got some decent flights.
However since then, whenever I've tried using Skyscanner I have been disappointed. Is it just my impression or has Skyscanner passed it's peak? And if so.. £1.4bn is a nice little stash for the owners.