Interesting--the Silicon Valley Biz Journal minimized the Agilent split last Thursday, so much so that I initially missed it. As did many old HPites, from what I've heard over the weekend
Lessee, now -- The old Instrument Company, the "real HP", was about $8B when it was divested by Lew Platt in 1999. It got to almost $11B in the run-up of the dot.com magic, and then fell to about $4.8B, like overnight. At that point, Microwave was still the kingpin, but there were a lot of other businesses, like Components which included something like 80% of the LEDs of the world, and Medical and Analytic Chemistry, and Automatic Board Testers, Atomic Clocks, and even Logic Analyzers.
Today, much of that has been divested -- Components and Medical sold to Philips mostly, Atomic Clocks and Board Test sold off or spun into new companies.
Agilent, as a derivative of its old Microwave line, is doing cell phone testing--something like 98% of all cellphones ever sold were tested on Agilent equipment, if my sources are right. And their 'scope business is actually doing pretty well, merged with Logic Analyzers--Tektronix lost the recipe some time ago, and got sold to Danaher--WHO?
Danaher is sort of everything Agilent 'could be'-- they are as diversified as Siemens or GE. Their website proudly says, "$16B science and technology leader in Test and Measurement, Environmental, Dental (yup!), Life Sciences and Diagnositics, and Industrial Technologies." Their T&M lines include acquisitions Tek, Fluke (Bill Parzybok sold Fluke to them), and Arbor (a version of Al Steiner's old Colorado Telecoms); these are a bit distant from dental. And Danaher valuation is $48B, 20% higher than all of HP on sales that are one-eighth as much. Whew....
Anyway, now Agilent is subdividing again--into a Life Sciences pure play, about $4B in size, spinning off the old T&M business, about $3B in size. The rationale? That the stock market will value them more higher if they're understandable for what they're trying to do.
By the way, the market already values them at $17B, on $6.6B in revenue. They'd like to go HIGHER
HP, today, at $21.03 per share, is valued at $40.44B, with sales of $120B. Can you imagine your HP stock price jumping to $150/share? That's the equivalent value that Agilent owners have today.
Is that what they mean by 'unlocking value'?