Seattle Times: Mergers taking toll on Seattle
Mergers and acquisitions are taking toll on Seattle
He doesn't really provide many examples other than that. I wonder what others think of his article, and whether it is main page post-worthy.Jon Talton wrote:My economic lumbago starts to act up when I see the merger activity involving Seattle companies in recent months. In general, we've been on the losing end.
Among the lost: Safeco, Getty Images, Pyramid Breweries and likely Puget Sound Energy, along with many small technology firms. Seattle also apparently came close to losing Washington Mutual to JPMorgan Chase, and might eventually do so.
Certainly, Amazon and Microsoft have been acquiring, and the long battle to snare Yahoo continues. But the mergers and acquisitions balance sheet this year is not in our favor.
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Losing Safeco's top tier salaries will hurt the city, particularly downtown, but in general Seattle is still acquiring more than it's losing.
I guess a good question would be where can I find data on recent M&A activity involving Seattle companies?
Thankfully not. We'll still have power 24/7.
http://seattletimes.nwsource.com/html/l ... ethru.html
This is probably a prime example of why so many people write off Bubbleheads as "doom and gloom". The MSM puts out garbage articles like this with no real facts.
M$ is still buying small tech companies. (Ref: Microsoft Acquistions. Amazon is still expanding. WaMu itself grew by acquiring dozens of smaller banks in the 90s/00s.
This year may be bad because of WaMu; if M$ ends up buying part or all of Yahoo, it will probably net positive for the city.
E.g.
A) A company in a growth industry can be bought because the buyer wants to diversify to the new city. This is probably a good thing for the city (as well as shareholders), and maybe even the employees.
So if/when WaMu fails that's probably a loss. But when a smaller tech firm is bought, it often means they grew enough to be purchased by an IBM or MSFT or someone.
So if a startup is bought by Google and moved to to San Jose, that's OK because it's a growth opportunity for the buyer?
Any time high paying jobs leave, it's a negative... IMO.
Just listing companies that have been bought tells you absolutely nothing about how it changes the general employment picture in an area.
Thanks for the clarification.
Based on what I know of most M$ acquisitions, they're typically neutral (by your definition) or a slight loss for the city they're located in, as M$ will take over HR and other oversight functions.
Google opened up in Kirkland a long time ago. Half the people I worked with at Amazon left for Google...
Seattle is positioned well for this downturn so far. The tech sector has largely been left alone at this point, so M$ and other tech firms are okay. Amazon's free shipping seems to be working out. Boeing is competetive due to the weak dollar.
If any of those change, that is what is really going to cause a severe downturn here.
I don't think we're going to escape, however. It'll spill over into tech and the consumer retrenchment will spill over and affect Amazon, and global recessionary forces will cause reduction in Boeing orders and profits. WaMu was just our little corner of the financial sector imploding, but it didn't have a lot of effect on the broader economy here. Starbucks laying off managers here is just the beginning...
Agreed. That is why I mentioned M$ and tech, and then mentioned the 'Zon.
However, gas and oil seem to be pulling back, and demand in terms of miles driven has pulled back in a historic way. Amazon is still reporting good earnings and the effects of free shipping costs have not shown up in Amazon's bottom line so far. I believed they claimed in last weeks conference call that their warehouse network is distributed enough that they're close enough to the customer to keep shipping costs low.
I worked there for 5 years and love to hate on them, but so far they're countering the trend.
They're definitely a bellweather for me for the consumer downturn, though -- when it hits Amazon we'll probably be in the worst of it.
Google even got kicked in the teeth recently and missed sales and earnings. I think there's still more downside there, though, Google is just an advertising company and they've got most of the internet advertising market sown up so they're limited by expansion of advertising dollars -- and during a recession advertising spending should flatten out and so should Google's revenue growth.