With $70 billion in the till after the end of this quarter, Apple could buy many of its competitors

With $70 billion in the till after the end of this quarter, Apple could buy many of its competitors
With companies like RIM and Nokia having problems, both firms have been listed as potential takeover candidates for Samsung or Microsoft, two of the more well-heeled firms in the handset business. RIM's shares, in fact, fell to a 52 week low of $27.08 on Friday, down 21% on the day after reporting lower than expected Q1 earnings and cutting estimates for the second quarter and the year. In fact, the rumor mill has been full of possible deals like Microsoft buying Nokia or Samsung buying RIM. Right now, there are no strong signals that any these deals are seriously being considered.

At the end of this quarter, Apple will have enough cash to pay the enterprise value of the manufacturers of 75% of cell phones in the industry

At the end of this quarter, Apple will have enough cash to pay the enterprise value of the manufacturers of 75% of cell phones in the industry

One interesting, but highly unlikely scenario, involves Apple. The iPhone manufacturer is expected to have a treasure chest of $70 billion in cash at the end of the current quarter according to Horace Deidu, an analyst with Asymco. Even without using its high priced stock for currency, Apple can take its $70 billion war chest and buy up the manufacturers of 75% of the handsets in the cell phone industry.Even more amazing, take out Samsung and Apple could buy the remainder of the entire industry for cash!

While the Federal Trade Commission would never agree to approve such a transaction, if Apple were to pay the enterprise value for RIM ($13.8 billion), Nokia ($22.6 billion), HTC ($25.4 billion) and Motorola Mobility ($4.2 billion), it would cost them $66 billion-less than the amount of cash Apple will shortly have on hand. In real life, of course, one would have to offer a premium price to the shareholders in order to buy them out. That is where Apple's high priced stock would come in handy. A combination of stock and cash would be more than enough to get a deal done. But alas, it is just a pipe dream because of anti-trust laws.

Still, Apple would probably be able to get approval to purchase one of its rivals excluding Microsoft. Would you like to see them go for an Android manufacturer like HTC or Motorola, or aim for RIM? Apple has been able to amass this cash hoard because of the incredible profitability of the iPhone. With just 4% of the worldwide handset market, Apple brings in more than half of the industry's profits. Could you imagine the pile of cash Apple would have available to tap if it increased its market share just a little? 

source: Asymco via AppleInsider

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54 Comments

1. Eingild

Posts: 203; Member since: Apr 19, 2011

This damn site. Always talking about how rich and how great Apple is. Don't get me wrong. I love Apple as much as the man behind it. But dude, seriously? I'm tired of all these biased craps that PA is putting on Apple. Always considering Apple as the greatest of all time. >.

4. clevername

Posts: 1436; Member since: Jul 11, 2008

Phonearena didn't write this article. This news has been circulating around several websites today, and all over twitter. That kinda makes it news. And since its news about the cell phone industry, PA reports it. No bias there. And about being the greatest, they just point out how rich they are. Again, not biased just facts. Can't speak for other articles but this one is pretty simple.

8. Eingild

Posts: 203; Member since: Apr 19, 2011

Thanks for clarifying that out dude. I mistook the essence of the article.

15. The_Miz

Posts: 1496; Member since: Apr 06, 2011

Get over yourself. Apple is rich, their iPhones sell like hotcakes.

20. doubler86

Posts: 320; Member since: Jan 26, 2011

Ya they sell like hotcakes, they sell almost 1/3 of the amount of Android phones.

40. Lucas777

Posts: 2137; Member since: Jan 06, 2011

ahh but how much does a single one of said devices sell?

43. showtime_tech

Posts: 4; Member since: Jun 11, 2011

In only two carriers with one phone, did u forget to calculate that part of the math.With all due respect your argument is rubbish its like your making iphone look good by the fact they can outsell 1/3 of android phones with one that is not as advanced spec wise as some android phones. My question is are u the ifanboy i suspect u are?

25. Hunz unregistered

Well this isn't the matter of this Site! Now a dayz there is alot of thing or Business how Apple do! Of course Apple have lots of Good news & also Furthur you'll see how many news out there after release Iphone 5! With all due Respect, Apple make an incredible Job on its own way! Enjoy!:)

2. SuperAndroidEvo

Posts: 4888; Member since: Apr 15, 2011

Hey Apple with 70 Billion dollars, will you lend me $10,000.00? To you Apple that is like 2 cents. It will help me with buying that Ducati StreetFighter that I want. I am just only short $10,000.00. If I can have it now & not wait until September it would be a huge blessing. I might even buy an Apple iPhone 4S/5 when it comes out. What do ya say Apple? Pleeeeeeeeeeease!?!?!?!?!?!?! lol

3. bossmt_2

Posts: 459; Member since: Oct 13, 2009

As long as apple consumers agree to pay premiums for software and hardware, they'll keep these insane profits. Apple is truly an amazing company, people will really pay any price for anything they tell them is a must have.

5. TOdoubleD

Posts: 114; Member since: Mar 28, 2011

This isn't news, its some dumbazz sitting around thinking, "wow this company has so much money they could buy this company". Yeah that took some serious brain power to come up with that one. I highly doubt that Mr Jobs has any interest in any of it.

6. coria791

Posts: 21; Member since: Jun 12, 2010

Please Phonearena we know Apple is the big COMPANY OUT THERE I LOVE THIS WEBSITE A LOT BUT PLEASE DONT GIVE APPLE ANY IDEAS THEY HAVE ALL THE MONEY THEY CAN ASK FOR

7. ztedac

Posts: 69; Member since: May 17, 2010

yes... apple first sues them then buys them >.>

9. coria791

Posts: 21; Member since: Jun 12, 2010

Yea for real im like what the hell

10. biophone

Posts: 1994; Member since: Jun 15, 2011

Apple has nice products not the best spec wise but it's nice to used and are very high quality. People like high quality products so yeah it's Bo surprise how successful they are. I just wish they could compete better in other areas but there fanbase doesn't care. To them it's all about the experience which it should be but specs are apart of that to me.

11. Sniggly

Posts: 7305; Member since: Dec 05, 2009

If Apple were to offer to buy Motorola, I hope Motorola would stare them square in the eyes and say "Fu.ck you."

13. 530gemini

Posts: 2198; Member since: Sep 09, 2010

That would be you sniggly, not Motorola :)

17. remixfa

Posts: 14605; Member since: Dec 19, 2008

this article is retarded. What would Apple stand to gain from buying motorola or the other companies? They would only be interested in samsung or LG for their screen and chip technologies. And would anyone exept the most die hard brain dead apple fan boy even want that? HELL NO. This article was written by an apple fanboy for apple fanboys over at appleinsider.com It should not be reported as news by any legitimate site. Honestly, this site goes out of its way to earn the whole iphonearena gaffes by repeating garbage like this. And yes, I would be just as offended if they said MS or Google... both of which that have massive warchests... should buy up the entire industry. The industry's state of innovation is due to its heavy competition, not because of any one company.

52. matt unregistered

Nokia is also a company worth buying simply because of the enormous patent portfolio they have. Samsung are too big for Apple to buy out. Only realistic company that are possibly going to be bought are RIM or Nokia. They are losing market share and value and need to step up their game. RIM is a proven work horse in business so its worth it for other companies to but out to integrate their services with their own. For eg Samsung with its galaxy s line could make it work as a business phone with all the functionality of android which would also help them beat apple.

26. Sniggly

Posts: 7305; Member since: Dec 05, 2009

Damn straight, Gemini. If you put me in charge of Motorola it'd become bigger than Apple.

29. 530gemini

Posts: 2198; Member since: Sep 09, 2010

Lol sniggly. If you're that good, you won't need Motorola to put you in charge. You'll have your own company ;)

38. Sniggly

Posts: 7305; Member since: Dec 05, 2009

Well, maybe I will have my own company. And maybe I'll fu.cking buy Motorola myself. How do you like DEM apples?! :P

12. JB unregistered

And yet they still don't pay a dividend.

42. Lucas777

Posts: 2137; Member since: Jan 06, 2011

precisely why i wud never (now) buy apple stock... shuda bought it 5 years ago though... haha

14. som

Posts: 768; Member since: Nov 10, 2009

Apple has $70 billion cash in hand, how much is Samsung have cash in hand?

18. remixfa

Posts: 14605; Member since: Dec 19, 2008

Microsoft has more cash on hand. Apple may seem like a big company but they are roughly 1/4th the size of MS. They just spit out how many billion for Skype.. paid how many billion to Nokia.. and they didnt even blink an eye.

30. 530gemini

Posts: 2198; Member since: Sep 09, 2010

Samsung has $21.11B cash and $10.62B total debtMicrosoft has $26.66B cash and $13.16B total debtApple has $26.48B cash with ZERO 0 debt (estimated to have $70B cash flow by end of 2nd quarter reports)So how can Apple only be 1/4 of MS when they have more $$$ than MS? Lol.

41. Lucas777

Posts: 2137; Member since: Jan 06, 2011

haha remixfa doesnt know what he is talking about... its not like microsoft just buys whatever without a blink... obviously nokia is still around... if they were as rich as apple they wudnt even need to think about it..

44. remixfa

Posts: 14605; Member since: Dec 19, 2008

Apple makes like 5 products and has a very streamlined company. MS has multiple devisions that are as big or bigger than Apple. MS's cashflow is much larger than apple's. Cash flow and reserves are not the same thing. Apple makes a higher profit margin than MS because of this, though MS brings home billions more over all than Apple. You think Apple's like 10% of the computer market and like 20% of the smartphone market bring home more than Microsoft's dominance in computers, software, gaming, and a dozen other things?? You dont seem to understand business. But hey, thats ok, most dont which is why people keep voting these idiots in power that keep f**king things up.

48. 530gemini

Posts: 2198; Member since: Sep 09, 2010

Huh? I already gave you the figures and you're still not getting it. Tell us then how much cash reserves MS has, lol. The more products you produce, the more money you shell out in producing them as well, and there's no guarantee that all of them would be bestsellers. Fortunately for Apple, majority of their products are bestsellers. That is why they are making tons and tons of profits. It's only in the corporate industry that MS still excels, but think about this, the iphone and the ipad is growing rapidly in that area as well. And think about this. A desktop pc is more expensive to produce than an ipad and an iphone, but the iphone and the ipad are more expensive than some pc's, so there's bigger profit on the ipad and the iphone, lol. I do understand business, but you don't seem to understand the actual figures, lol.

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