Linas Beliūnas on LinkedIn: On this day in 1997, Microsoft invested $150 million into Apple. It saved… | 235 comments (2024)

Sophokles Tasioulis

Experienced international producer of movies and media ventures, with decades of history and success.

1y

The value would be substantially bigger today. Here is what our friend ChatGPT is calculating: To determine the worth of $150 million invested in Apple stock in 1997 by 2021, there are several steps involved:1. **Initial Stock Price**: We need to know the average price of Apple stock in 1997. For the sake of this calculation, I will use the closing price of Apple's stock on December 31, 1997, which was roughly $0.78 (adjusted for stock splits).2. **Amount of Shares Purchased**: \[ \text{Number of shares} = \frac{\text{Initial investment}}{\text{Stock price in 1997}} \] \[ \text{Number of shares} = \frac{150,000,000}{0.78} \] \[ \text{Number of shares} \approx 192,307,692 \]3. **Value in 2021**: Apple's stock has split several times since 1997. To get the value in 2021, we need to account for these stock splits: - 2-for-1 split in 2000 - 2-for-1 split in 2005 - 7-for-1 split in 2014 - 4-for-1 split in 2020 After accounting for all these splits, 1 share of Apple stock purchased in 1997 would have turned into 112 shares by 2021.We would be closer to a few trillion rather than just the double of the initial investment.

Bogdan Grigorescu

Sr Tech Lead | Engineering | Automation

1y

A major driver for the deal was the antitrust law. Through the deal, Internet Explorer will run on Mac too not just on Windows - so Microsoft couldn’t be accused of using Windows to eliminate Netscape as they were just trying to build a successful web browser.The deal was also about patents - a settlement involving perpetual cross-licensing of existing patents. The settlement was designed to end the long standing legal disputes about MS Windows infringing on Apple’s patents.The deal was overall very beneficial for the tech landscape.

Michel Weiss

Strong Sales, Relationship and Asset Management background with over 30 years of experience

1y

Should read 285 Billion instead of 285 Million today

Yiorgos Bontzios

Founder, Mentor

1y

Linas Beliūnas This is half of the story. The company which actually saved Apple was ARM. It's lesser known bc 'being saved by your competitor' makes a better story. Apple brought around 1.1 billion in cash by selling ARM stock

Brian Wayman

Ex Apple 21 years. Enterprise Platform Consultant, Partnerships, and Strategist

1y

This is wrong. It’s a myth. Goldman Sachs saved Apple with a $661M convertible bond offering in 1996. “Apple hired Goldman Sachs Group to manage a $661 million convertible bond offering that helped it stave off bankruptcy.” - Institutional Investor“Will Apple Computer run out of cash soon?” asked an article in The New York Times on April 7, 1996. That summer, it tapped the bond markets, raising about $600 million and averting a crisis. Later in the year, Mr. Jobs, who had left Apple more than a decade before, returned to the company.https://archive.nytimes.com/dealbook.nytimes.com/2013/04/30/apple-raises-17-billion-in-record-debt-sale/Stop the lies! The day that Microsoft 'saved' Apple - ZDnet https://www.zdnet.com/article/stop-the-lies-the-day-that-microsoft-saved-apple/https://www.institutionalinvestor.com/article/2bstzdzq48s690lszdog0/portfolio/2013-deals-of-the-year-apple-bond-issue-makes-history

Rajib Roy

Deputy General Manager at Rangdhanu Spinning Mills Ltd & Dream Holiday Ltd

1y

The investment was indeed a controversial one at the time, as many people thought that it was a sign of weakness on Apple's part. However, as you pointed out, the investment ultimately proved to be a wise one, as it helped Apple to turn things around and become one of the most successful companies in the world.The story of Apple and Microsoft is a reminder that competition can sometimes lead to collaboration, and that collaboration can be even better than competition. In this case, both companies benefited from the investment, and the world is a better place because of it.It is a good summary of the story of Microsoft's investment in Apple, and it is sure to interest readers who are interested in technology and business.

Stevan Popovic

Dev Ops/Cloud Engineer/Systems Admin. Currently undertaking Kubernetes training. Previoustraining includes Ansible, DevOps Foundations, Docker, Git, Jenkins, MySQL, Nagios, Packer, Redis and Terraform.

1y

If Apple went bankrupt. The competition commission would have gone after Microsoft. At the time the Netscape issues were ongoing. They did for self preservation.

Vasula Premawardhana

Managing Director @ Long Term Alpha Management | Pioneering REIT Fund Management | Capital Market Strategist

1y

$285 million Linas Beliūnas ? Didn’t sound right. Made me feel bad for Bill and Steve’s surprising deal that sent shock waves. So I did some research.. so how about $127Bn (as of 2020) “So, what ever happened to Microsoft’s $150 million worth of Apple shares?Well, as of the terms of the deal, Microsoft had to hold on to the shares for at least three years. Then, in 2002, it started selling its Apple stock again, and got rid of its entire stake by the middle of 2003. In total, it netted Microsoft around $550 million. That’s a healthy 260% gain in just six years.But what if Microsoft kept its Apple stock till today?Microsoft held approximately 18.1 million shares in Apple at the time it started selling them. Since then, multiple stock splits have taken place: one on a 2-for-1 basis on February 28, 2005, and one on a 7-for-1 basis on June 9, 2014. This means those 18.1 million shares would have been 253.4 million shares as of today. Multiply that by the current stock price of $503,43, and the result is a whopping $127.5 billion stake. That’s 5.9% of Apple’s total value, a market capitalization of $2.1 trillion.”https://thenextweb.com/news/microsoft-once-owned-a-chunk-of-apple-heres-what-it-would-have-been-worth-today

Nele Mletschkowsky

Managing Director - DACH bei Archipel Academy mit Expertise in SaaS, EdTech & AI

1y

👍🏻👍🏻👍🏻