New York — IBM wants to buy Sun and is prepared to pay a hefty premium.  Whatever this deal’s value to IBM, it cannot be anything to do with Sun’s operational integrity because that has declined as markedly over the last decade as IBM’s has improved.  The chart tells the story.

You can see immediately why IBM is doing well in this recession, much as it did in the Great Depression.  The company has tightened up core operating capabilities and is now a NORTH RIVER MANAGEMENT GRADE A company. Sun management, once a B, now merits an F.  These firms are moving in opposite directions.  IBM will have to rescue a troubled operation.

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