The tech sector's attention was captured by two major deals this week, as Hewlett-Packard Co. said it will buy Electronic Data Systems Corp. for $13.2 billion and CBS Corp. agreed to acquire CNET Networks Inc. for $1.8 billion.
On Tuesday, tech bellwether HP said it is buying EDS for $25 per share in cash. The price represents a nearly 33 percent premium from the technology services provider's closing price last Friday, the last trading day before word of the acquisition leaked.
Robert W. Baird analyst Jayson Noland said the EDS acquisition would provide HP with a larger presence in the technology services sector, as well as new cost-cutting opportunities. Integrating the company, however, poses a significant risk, he added.
On Thursday, CBS and CNET said CBS will buy the online news and information company for $11.50 per share in a cash deal intended to increase CBS' Internet presence. The purchase may also get CNET out of a skirmish with one of its biggest shareholders, which has been pushing for changes at the company in the wake of a stock slump.
Pacific Crest Securities analyst Steve Weinstein said the deal is good for CNET shareholders.
Weinstein said CNET "was a platform with a lot of potential opportunity, but the opportunity wasn't really being realized."
Elsewhere in tech, activist investor Carl Icahn notified Yahoo Inc. on Thursday that he will lead a proxy fight to oust the company's board unless it renews negotiations with Microsoft Corp.
The world's largest software company withdrew its bid for the struggling Internet icon on May 3 after the two sides couldn't agree on a price.
Yahoo Chairman Roy Bostock responded to Icahn's move by indicating the Sunnyvale, Calif.-based company is prepared to battle the New York financier.
Also this week, beleaguered wireless carrier Sprint Nextel Corp. posted a wider first-quarter loss, hurt by continued subscriber losses, severance costs and declining revenue.
Chief Executive Dan Hesse said the company's turnaround will take "many quarters" but added "we are acting quickly and decisively to improve our performance."
IN CASE YOU MISSED IT: Virgin Mobile USA Inc. disclosed Wednesday it is in preliminary talks with SK Telecom Co. about possible "strategic options," which could refer to a buyout or at least a major investment.
Virgin Mobile, the U.S. wireless unit of Richard Branson's Virgin Group, went public at $15 per share last October. Its stock has plunged since, and finished Friday's trading at $3.43. SK Telecom, South Korea's largest cell phone service provider by subscriber numbers, is also the majority owner of Helio LLC, another U.S. cell-phone company, which could be combined with Virgin Mobile.
WHAT'S AHEAD: HP reports its final fiscal second-quarter results on Tuesday. On Tuesday, Palo Alto, Calif.-based HP reported solid preliminary results, with profit and sales ahead of Wall Street's expectations.
Financial software maker Intuit Inc. reports its fiscal third-quarter results on Tuesday and online music retailer Napster Inc. reports its fiscal fourth-quarter results on Wednesday.
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