A Potential Suitor for Hewlett-Packard - NYTimes.com

The case for Oracle buying HP: “Analysts reckon H.P. will pull in $13 billion of operating profit in the 2012 fiscal year. Add in a fraction more from Autonomy, and that would bring Oracle a 16 percent annual return on its total investment off the bat. Oracle might be able to squeeze out some costs. If it cut 10 percent of H.P.’s selling, general and administrative expenses and its research and development costs, that would bring $1.6 billion in annual savings. Throw those in, and pro forma for the 2012 fiscal year Oracle’s return on investment would be 18 percent.

Along the way, it is possible that H.P. could slightly ease the burden for an acquirer by selling businesses it bought last year in its $1.2 billion purchase of Palm. The mobile operating system may be in limbo, but the related patents are a hot commodity.”

Yesterday I read that Amazon is angling to buy Palm, so that cash is looking solid.

Cisco To Shut Down Flip Video Camera Business; Will Give Pink Slips To 550 Employees

Closing down a lot of the comsumer products at Cisco, including Flip, as Leena Rao reports:

Cisco has just issued a release stating that in a strategic plan to “align its operations,” the company will exit parts of its consumer businesses and realign the remaining consumer business to support four of its five key company priorities: core routing, switching and services; collaboration; architectures; and video. One of the casualties of this realignment: Cisco’s video camera Flip business, which was part of its $590 million acquisition of Pure Digital.

As part of the plan, Cisco will close down its Flip business and “support current FlipShare customers and partners with a transition plan.” Cisco will also refocus its Home Networking business and will integrate Cisco umi into the company’s Business TelePresence product line. As part of the transition, Cisco plans to eliminate 550 jobs.

Flip didn’t really make sense in 2009, when video was available on cell phones and the writing was on the wall. This is Cisco retrenchment from throwing around a lot of ready cash, and trying to refocus on the business sector.

I bet Cisco will be acquired within the year. All of this cleaning up — and passing along the costs in the form of stock valuation falling — will make the company attractive to people like IBM, Oracle, or Microsoft.