With market meltdown, which tech firms become predator or prey?

With market meltdown, which tech firms become predator or prey?

Smart companies will hunt for good merger and acquisition opportunities with stocks at multi-year lows. Here are the ones to watch.

IBM | Symbol: IBM | Market cap: US$121B | Cash and short-term investments: US$9.8B

IBM, which this week reported a 20 percent jump in Q3 net income, is a quiet but happy shopper. Big Blue has already bought 12 firms this year, including BI (business intelligence) vendor, Cognos Incfor US$5 billion. With nearly US$10 billion in cash, expect IBM to continue its shopping spree.

Google | Symbol: GOOG | Market cap: US$103B | Cash and short-term investments: US$12.7B

Google's US$3.1 billion cash purchase of online advertising firm DoubleClick last year was an aberration. The online company has otherwise mostly bought startups to build out its portfolio. Like with its US$1.65 billion stock purchase of YouTube in 2006, Google likes to use its shares whenever possible. But he collapse of its stock price -- down 56 percent from its peak a year ago -- would seem to rule out stock-based transactions, for now.

Hewlett-Packard | Symbol: HPQ | Market cap: US$94.3B | Cash and short-term investments: US$14.8B

HP has shown its willingness to make big buys for giant leaps in the marketplace. In May, HP bought It outsourcer EDS for US$13.9 billion, and lest we forget its US$25 billion merger with Compaq Computer in 2002. With EDS, HP looks to cement its lead over IBM as the world's largest IT vendor by sales, a lead it established just two years ago. Look to HP to go bargainhunting and add to the six firms it has bought so far this year.

Apple | Symbol: AAPL | Market cap: US$78B | Cash and short-term investments: US$20.8B

Apple has reportedly bought ten firms in its 32-year history.

Apple's vertical business model guarantees that it never buys to gain market share, but only to acquire technology from startups such as processor designer PA Semi that it can easily digest.

On the other hand, if anyone can handle an acquisition right now, Steve Jobs' Apple could. Apple is very profitable. And it ranks just behind Microsoft in terms of cash-on-hand for a buyout.

Perhaps Jobs should reconsider the Apple-Sun merger that almost happened three times -- except this time, Apple would be the buyer, not Sun.

SAP | Symbol: SAP | Market cap: US$43B | Cash and short-term investments: US$3.2B

German enterprise software giant SAP also appears unlikely to be interested in the mergers and acquisitions game. Apart from last year's US$6.8 billion acquisition of Business Objects, SAP is best known for conservative, organic growth. It also has the least cash of any vendor on this list.

Matt Hamblen contributed to this story.

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