Notes on Michael H. Spindler
- Although Michael H. Spindler joined Apple in September 1980 as marketing manager for European operations, the native of Berlin, Germany, didn’t pop up on the radar screens of most Apple watchers until January 29, 1990, when he moved to Cupertino to assume the role of chief operating officer, taking over the worldwide manufacturing and marketing units that had previously reported to Jean-Louis Gassée.
- In stark contrast to Steve Jobs and John Sculley, Spindler is a passionately private man who, according to one former executive, “did not get where he is by showing his butt in public.” As a result, most people would be hard pressed to recall a single thing he accomplished while at the helm of Apple. That’s a shame, because had he achieved his ultimate goal, its effect would have been more profound than anything anyone else at Apple had ever accomplished: The firm would have ceased to exist.
- Upon arriving in Cupertino, Spindler was instructed by CEO Sculley to begin a secret search for a way to pair Apple’s brand name and superior software with the market muscle and boardroom credibility of a larger company. Sculley felt that the Mac market would slowly erode and that Apple’s only hope was to create new revenue streams from products such as the Newton personal digital assistant and Pippin set-top box, but developing these products to the point of self-sufficiency would require the resources of a larger company.
- Sun Microsystems, an up-and-coming workstation manufacturer, had been trying to merge with Apple since 1988, and by the fall of 1990, a deal was all but finalized when, out of the blue, IBM president Jack Kuehler called Spindler and proposed working together on RISC (reduced instruction set computing) chips. Under the Sun deal, Spindler faced demotion when Sun CEO Scott G. McNealy took over as COO of the combined companies. Working with IBM, however, offered Spindler a way to save his high-powered job, so Apple left Sun at the altar.
- The successful introduction of Power Macs based upon the jointly developed PowerPC was proof that Apple and IBM could work together. In October 1994, executives from both companies holed up for two weeks at the Summerfield Suites Hotel near San Francisco International Airport to work on the terms of a merger. Things got ugly in November when Markkula, Spindler, and Joseph Anthony Graziano, Apple’s chief financial officer, met with IBM CEO Louis V. Gerstner Jr. and his team at the Westin Hotel near Chicago’s O’Hare International Airport to hammer out the details of a deal that would have been unthinkable a decade earlier: selling entrepreneurial Apple to conservative IBM. After brief presentations by both sides, Gerstner pulled Spindler and Markkula aside and privately offered $40 a share for Apple (valuing the deal at about $4.5 billion) when the stock was trading around $35. The Apple contingent balked at the price. Spindler demanded golden parachutes for himself and other top Apple managers and held out for $60 a share, hoping to instigate a counteroffer. It never came. IBM left abruptly.
- As Markkula told The Wall Street Journal, “The board has been very pleased with Michael’s performance. He is the best thinker at Apple. He is truly a very brilliant man.”
- By December 1995, a shared fear of Microsoft had driven Sun Microsystems’ CEO McNealy to meet with Apple’s board at the St. Regis Hotel in New York, where they began nailing down the details of a stock-swap deal that would place McNealy in charge of the combined company. Ironically, five years before, Apple had walked away from a deal to acquire Sun, and now the tables were turned, with the spurned McNealy on the verge of taking over Apple. It looked like Apple might be able to put a present under its shareholders’ Christmas trees after all, but negotiations broke off when Apple warned of an impending $69 million quarterly loss.
- Following the meeting, the board met to discuss Sun’s latest merger offer. Sun proposed a stock swap, valuing Apple’s shares at $23, far below its $31.625 closing price that day. The board knew the shareholders would never approve such a deal. The situation became even more bleak after news of the lowball bid was leaked, along with reports that large Mac purchases were being delayed due to the turmoil, which would lead to slowing sales. Markkula called an emergency meeting of the board for January 31 at Manhattan’s St. Regis Hotel. McNealy was invited to personally pitch his merger proposal, but he stuck to his $23 offer and the board balked.
- Since leaving Apple, Spindler has kept a low public profile. He sits on the supervisory board of German publishing conglomerate Bertelsmann AG (www.bertelsmann.de) and is a managing partner at Upstart Capital (www.upstartcap.com).