Apple Inc. (NASDAQ:AAPL) apparently has a very good first-hand understanding of holiday shopping, because it seems now that the company is using some of its vast stash of cash to acquire some businesses. We reported here Tuesday about Apple Inc. (NASDAQ:AAPL) finalizing a deal initiated last month to buy HTML5 developer Particle, and now Apple Inc. (NASDAQ:AAPL) seems to be in serious discussions to buy a company that might otherwise close its doors.
Color Labs, a photo- and video-sharing social network company which has had a relationship with the Apple Inc. (NASDAQ:AAPL) iOS and the Google Inc. (NASDAQ:GOOG) Android operating systems, is apparently on its way to closing unless CEO Bill Nguyen can close a deal with Apple Inc. (NASDAQ:AAPL). The $40-million company seems to be considering a deal that would be in the “high double-digit” millions, which would cover the value of the company and give all investors a decent return on their investments.
It seems that Apple Inc. (NASDAQ:AAPL) might be more interested in the patent and patent-pending portfolio of Color Labs than keeping the company running. Color Labs has some patents having to do with recording HD video, GPS location (maybe for an improved mapping application?) and technology for saving battery life (battery life has been an issue with the iPhone 5).
Color Labs founder Nguyen and the board of directors have been at a loggerheads lately, but Nguyen is known to have shown the Color Labs technology with Apple Inc. (NASDAQ:AAPL) executives, including Eddy Cue, head of internet software and services. Color Labs has had some visibility with its free Color app both for iOs and Android, and apparently recently was demonstrating a broadcasting app that hadn’t been released yet.
As the discussions are in the early stages, there is little chatter coming directly from Color Labs or Apple Inc. (NASDAQ:AAPL). However, if this deal goes through, it will be interesting for observers and investors of Apple Inc. (NASDAQ:AAPL) stock – like billionaire fund manager David Einhorn of Greenlight Capital – to see whether Color Labs will continue to exist and be a native iOS app developer or will it be scalped for its patent portfolio.