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"Microsoft owns Apple" myth - Mac Applications & Software

I've read a couple of times from completely different sources that Microsoft owns a part of Apple. Sheesh! This is coming from that 1997 investment deal when Apple pulled MS's chestnuts out of the fire for anti-trust purposes, but people still think MS "saved" Apple and still owns a piece of it. There's an article over at news.com where some guy who left Microsoft for Open Source says We looked at all the alternatives. We looked at Apple, but that's owned in part by Microsoft. (Editor's note: Microsoft invested $150 million in Apple in 1997.) And he looked at alternatives ...

  1. #1

    Default "Microsoft owns Apple" myth

    I've read a couple of times from completely different sources that
    Microsoft owns a part of Apple. Sheesh! This is coming from that 1997
    investment deal when Apple pulled MS's chestnuts out of the fire for
    anti-trust purposes, but people still think MS "saved" Apple and still owns
    a piece of it.

    There's an article over at news.com where some guy who left Microsoft for
    Open Source says
    We looked at all the alternatives. We looked at Apple, but that's
    owned in part by Microsoft. (Editor's note: Microsoft invested $150
    million in Apple in 1997.)

    And he looked at alternatives in 2000. See
    http://news.com.com/2008-1082_3-5065859.html?tag=lh
    for the whole interview.

    It was a five-year agreement that the parties let lapse in August of last
    year. Are there no press releases or other publicly accessible doents I
    could point people to and get the point across that the deal lapsed and MS
    doesn't own a piece of Apple?
    --
    Philip Stripling | email to the replyto address is presumed
    Legal Assistance on the Web | spam and read later. email to philip
    http://www.PhilipStripling.com/ | my domain is read daily.
    Phil Guest

  2. #2

    Default Re: "Microsoft owns Apple" myth

    In article <tdl.com>,
    Phil Stripling <zzn.com> wrote:
     

    I think you're confusing a couple of things which occurred at the same
    time. At the summer Macworld in 1997 there were a couple of relevant
    announcements. One was that MS would buy $150 million of Apple's stock.
    The other was a five-year agreement to continue developing MS Office for
    Macs. Both were in exchange for Apple dropping patent-infringement
    claims against MS.

    The five-year agreement expired, but as far as I can tell MS has not
    sold its stock.

    That said, avoiding Apple because it's "owned in part by Microsoft" is
    idiotic, regardless of how one feels about MS.

    There are a couple of details worth noting. One is that MS bought
    non-voting stock, meaning that unlike other stockholders, they don't get
    any direct control over what Apple chooses to do. (Obviously MS may try
    to influcence Apple through typical business methods, but they don't get
    the direct control that being a stockholder normally implies). The
    investment serves mainly to give MS some financial interest in Apple's
    continued success rather than giving them direct influence.

    The other thing is that MS's share of Apple is a small percentage.
    Looking at Apple's stock history-- the day the deal was announced,
    August 6 1997, Apple closed at $13.15. As of right now Apple's at
    $21.46. So assuming MS just bought and held (since I have no reason to
    suspect otherwise), their $150 million is worth something like $245
    million now. But Apple's market cap is $7.779 billion, so MS owns
    around 3% of stock.

    See <http://news.com.com/2100-1001-202143.html?legacy=cnet> for a 1997
    story on the initial investment.

    --
    Tom "Tom" Harrington
    Macaroni, Automated System Maintenance for Mac OS X.
    Version 1.4: Best cleanup yet, gets files other tools miss.
    See http://www.atomicbird.com/
    Tom Guest

  3. #3

    Default Re: "Microsoft owns Apple" myth

    In article <tph-422D63.13313721082003localhost>,
    Tom Harrington <no.spam.dammit.net> wrote:
     

    But Apple had a two for one split since then, so MS has double the
    number of shares--unless that split did not apply to nonvoting stock.

    --Michelle

    --
    Never play strip tarot.
    Michelle Guest

  4. #4

    Default Re: "Microsoft owns Apple" myth

    In article <west.cox.net>,
    Michelle Steiner <org> wrote:
     
    >
    > But Apple had a two for one split since then, so MS has double the
    > number of shares--unless that split did not apply to nonvoting stock.[/ref]

    The prices I used above take the split into account, so the ysis
    stands.

    --
    Tom "Tom" Harrington
    Macaroni, Automated System Maintenance for Mac OS X.
    Version 1.4: Best cleanup yet, gets files other tools miss.
    See http://www.atomicbird.com/
    Tom Guest

  5. #5

    Default Re: "Microsoft owns Apple" myth

    In article <tph-422D63.13313721082003localhost>,
    Tom Harrington <no.spam.dammit.net> wrote:
     
    >
    > I think you're confusing a couple of things which occurred at the same
    > time. At the summer Macworld in 1997 there were a couple of relevant
    > announcements. One was that MS would buy $150 million of Apple's stock.
    > The other was a five-year agreement to continue developing MS Office for
    > Macs. Both were in exchange for Apple dropping patent-infringement
    > claims against MS.[/ref]

    I have a fairly distinct recollection that the stock also could not be
    sold within that 5-year window, and that Microsoft sold it essentially
    as soon as they were allowed, and at a substantial profit.

    Now, having said that, I'm checking....

    Okay, $150M worth of non-voting, non-saleable shares, which convert
    after 3 years. That represented about 5% of AAPL at the time. Apple's
    stock apparently went up over 50% in the next 4 hours.
    Gregory Guest

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    Default Re: "Microsoft owns Apple" myth

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  7. #7

    Default Re: "Microsoft owns Apple" myth

    In article <tdl.com>,
    Phil Stripling <zzn.com> wrote:
     

    What makes you think that MS doesn't own a piece of Apple ?

    There's no way of knowing how much of Apple Microsoft owns.
    Apple's shares are publically traded. Anyone, or any company,
    can buy any number of them, up to the total number of issued
    shares. To the best of my knowledge, Apple have only one
    issue currently on the market: an issue of Common Stock.
    There are about 360 million shares of this stock issued and
    Apple have, as they must do by US law, published details of
    anyone who owns more than 5% of the company.

    The three 'people' who own more than 5% of Apple are two
    investment companies and, third highest, Steve Jobs himself
    with 6.2%. (Figures as of January 2003, from Apple's Proxy
    Statement.) It's possible, but unlikely, that Microsoft owns
    a controlling interest in one of the two investment companies.
    If someone wants to pay me my normal rates, I'll investigate
    this and some other relevant possibilities. Also note that
    I've ignored deferred compensation, options, etc. for the
    sake of simplicity but will investigate those too.

    Microsoft is not on the list. Therefore, as of January 2003,
    they didn't own more than 5% of Apple. Does that answer the
    question ?

    Lastly, it's worth considering that Microsoft and Apple are
    in similar lines of work and are certainly in the same sector
    of the stock market. If you're in the fast food sector and
    have some spare cash it's a terrible idea to invest it in
    another company in the fast food sector. Should that sector
    take a knock for any reason not only will your own company be
    in trouble but you won't be able to realise as much cash to
    use to solve your problems. No responsible investment
    advisor would tell Microsoft to make a big investment in
    Apple unless they were thinking of buying Apple outright.

    PS: To save you all calculating it, Steve's 24 million shares
    at $20 a share are worth about $480 million of your miserable
    capitalist dollars. But is he happy ?


    Simon Guest

  8. #8

    Default Re: "Microsoft owns Apple" myth

    <demon.co.uk> wrote:
     

    :-)

    I suppose so. But not because of his Apple stock, he isn't.

    --
    Andrew J. Brehm
    Fan of Woody Allen
    PowerPC User
    Supporter of Pepperoni Pizza
    Andrew Guest

  9. #9

    Default Re: "Microsoft owns Apple" myth

    Simon Slavin wrote:
     

    As far as I knew Steve sold all his shares, when he left Apple in 1985 to form
    NeXT. Upon his return in 1997, was paid only $1 a year for his services as
    interim CEO.

    Jeff Guest

  10. #10

    Default Re: "Microsoft owns Apple" myth

    In article <net>, Jeff Thomas <net>
    wrote:
     
    >
    > As far as I knew Steve sold all his shares, when he left Apple in 1985 to form
    > NeXT. Upon his return in 1997, was paid only $1 a year for his services as
    > interim CEO.[/ref]

    And he was granted a bunch of stock options and a jet. He later traded
    the options for actual stock (5 million shares), which will vest in
    2006 assuming certain conditions (e.g. that he is still CEO of Apple).
    His compensation for 2000-2002 (including the airplane) totaled about
    $87.5 million, not counting the stock or options.

    --
    Jerry Kindall, Seattle, WA <http://www.jerrykindall.com/>

    When replying by e-mail, use plain text ONLY to make sure I read it.
    Due to spam and viruses, I filter all mail with HTML or attachments.
    Jerry Guest

  11. #11

    Default Re: "Microsoft owns Apple" myth

    In article <080920031940011447%invalid>,
    Jerry Kindall <invalid> wrote:
     
    > >
    > > As far as I knew Steve sold all his shares, when he left Apple in 1985 to
    > > form
    > > NeXT. Upon his return in 1997, was paid only $1 a year for his services as
    > > interim CEO.[/ref]
    >
    > And he was granted a bunch of stock options and a jet. He later traded
    > the options for actual stock (5 million shares), which will vest in
    > 2006 assuming certain conditions (e.g. that he is still CEO of Apple).
    > His compensation for 2000-2002 (including the airplane) totaled about
    > $87.5 million, not counting the stock or options.[/ref]

    And won't be worth a bucket of warm spit if the stock value doesn't
    stay high enough.

    The jet is a hole in the air (or on the tarmac) into which you throw
    large amounts of money. Hope they're leasing it out a lot.
    Steve Guest

  12. #12

    Default Re: "Microsoft owns Apple" myth

    In article <giganews.com>,
    Steve Hix <net> wrote:
     

    Apple lease it from Jobs, as far as I know.

    MK.
    Matthew Guest

  13. #13

    Default Re: "Microsoft owns Apple" myth

    In article <giganews.com>,
    Steve Hix <net> wrote:
     

    Apple stock a few days ago was at a 52-week high.
     

    It is his personal property.

    --
    Never play strip tarot.
    Michelle Guest

  14. #14

    Default Re: "Microsoft owns Apple" myth

    Michelle Steiner <org> writes: 
    >
    > Apple stock a few days ago was at a 52-week high.[/ref]

    The options would still have been worthless.

    Doesn't matter, though. According to

    http://quote.bloomberg.com/apps/news?pid=10000039&refer=columnist_crystal&sid=aEt7 cb79lerU

    In fiscal 2002, after it became clear his 20 million option shares
    weren't likely to rise out of the muck of San Francisco Bay, Jobs's
    board gave him options on another 7.5 million shares.

    In March 2003, after the end of my study period, Jobs gave up the
    ghost entirely on stock options. He turned in his 27.5 million option
    shares for a grant of five million free shares worth $74.6 million.





    --
    Plain Bread alone for e-mail, thanks. The rest gets trashed.
    No HTML in E-Mail! -- http://www.expita.com/nomime.html
    Are you posting responses that are easy for others to follow?
    http://www.greenend.org.uk/rjk/2000/06/14/quoting
    BreadWithSpam@fractious.net Guest

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