Jobs defends Apple's pile of cash

JESUIT PRIEST-LIKE Apple CEO Steve Jobs has been forced to defend the firm after Wall Street questioned why it's sitting on a £26.2 billion mountain of cash, according to Reuters.

Shareholders are questioning the wisdom of hoarding the money rather than offering stock buybacks or cash dividends. A cash hoard of £26.2 billion will always be a lot of money but if it's just sitting there it's not working for Apple or benefitting shareholders.

Under pressure at the annual shareholders question and answer session, Jobs made an enigmatic proclamation that hints at potential acquisitions. "We're a large enough business now, that in order to really move the needle, we've got to be thinking pretty bold, pretty large. And who knows what's around the next corner. When we think about big, bold things, we know that if we needed to acquire something, a piece of the puzzle, to make something big and bold a reality, we could write a check for it," he said.

Quite what these big bold acquisitions will be are unknown. No one knows what's around the corner but we do know the corners Apple has turned in the past. They have not included multi-billion dollar takeover bids for other companies. Job is half magpie, half Borg. He seeks shiny technological innovation from much smaller companies and absorbs them before regurgitating them as proprietary technologies in Apple's Macbooks, Iphones, Ipods and shortly, Ipads. A quick double check at Wikipedia on Apple's mergers and acquisitions history shows that Apple has never invested in anything it couldn't swallow whole. All of its recent buyouts were rather small companies.

Unfortunately for Jobs, most analysts are sceptical about his claims. According to Reuters, Hudson Square analyst Daniel Ernst is quoted saying, "I don't think they'd do a big acquisition. There simply isn't a business out there that would be a cultural fit with them. They're not like other companies."

Jobs reasoned with the shareholders that, "Our judgment and our instincts tell us to just leave that powder dry right where it is right now and it's going to come in awfully handy one of these days."

If Apple was thinking of moving to any other hardware territory, sharp analysts and Apple watchers would already be tracking its registered patents or company acquisitions. As of today, there are no ripples that suggest Jobs is moving any in particularly bold technological direction with his £26.2 billion.

However, let's tie Apple's position that it is primed for a bold move with the fact that Jobs hired a former Goldmans Sachs investment banker this year. Business Week reported that multiple sources close to the company believe that the investment banker is the first dedicated mergers and acquisitions specialist on its staff. Let the speculation begin. µ