Microsoft and Intuit announced on 20-May-95 they are terminating their planned $2 billion merger rather pursuing additional months of legal negotiation and investigation by the U.S. Justice Department (see TidBITS-275). The merger, originally announced in October of 1994, would have been the largest in the history of the software industry.
Speculation about the future of the deal began only the week before, when Microsoft failed to meet a filing deadline for a court brief, causing a temporary drop in Intuit’s stock price. Until that point, it was widely anticipated that both companies would vigorously purse the deal, especially in light of recent announcements by BankAmerica and NationsBank that they plan to enter the electronic banking market.
Asked about reasons for withdrawing the offer to buy Intuit, Microsoft Chairman Bill Gates has been quoted as saying the industry is moving too fast for Microsoft to wait for the sale to go through. Some industry sources estimate it might have been as late as mid-1996 before the deal could be finalized – assuming it was approved under U.S. antitrust laws.
Does this mean Microsoft is dropping its designs on electronic banking and commerce? Don’t count on it. Microsoft continues to aggressively recruit vendors and businesses for its upcoming Microsoft Network online service and you can bet online transactions are part of the package. Also look for Microsoft to offer finance services in upcoming wireless devices and personal information managers, in addition to direct integration in desktop applications and versions of Windows.