Googling For Gold
Published November 27th, 2005
With a market cap in orbit and more cash than a small nation, Google’s heft is altering the tech industry’s behavior. But when does its long-awaited shopping spree begin?
With the news that shares of online search giant Google Inc. had crossed the lofty $400-per-share mark on Nov. 17, the world may have witnessed something akin to the birth of a new financial planetary system. Given its market cap of $120 billion, double that of its nearest competitor, Yahoo!, Google now has the gravitational pull to draw in a host of institutions and company matchmakers unable to resist the potential profit opportunities. Google stock, with a price-earnings ratio of 70, represents one of the richest dealmaking currencies anywhere. That heft has attracted a growing galaxy of entrepreneurs, venture capitalists, and investment bankers, all of whom are orbiting Google in the hopes of selling it something — a new service, a startup company, even a new strategy — anything to get their hands on a little of the Google gold. “The dollars at stake are huge,” says Geoffrey Baldwin, managing director at San Francisco investment bank Perseus Group.
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