Logoworks reels in HP

Posted Apr 25th 2007 10:22AM by Tom Taulli
Filed under: Microsoft (MSFT), Hewlett-Packard (HPQ)

This week Hewlett-Packard Co. (NYSE: HPQ) bought privately-held Logoworks. The price was not disclosed and was probably relatively small (at least compared to HP's $111 billion market cap).

Logoworks got its start in 2001 and, as its name implies, helps companies come up with cost-effective logos and other designs. The firm has a team of 40 designers who are on location (not outsourced to some far-away location around the globe).

The company did not disclose its revenues but it has served over 45,000 customers, some of which include biggies like Disney Co. (NYSE: DIS) and Microsoft Corp. (NASDAQ: MSFT).

As for synergy, HP will certainly get some traction from its online properties and even printer business (need to put those logos on letter head, right?).

But I think the big opportunity is picking up new small business customers. After all, when starting a company, it's fairly common to come up with a logo.

And, if the logo looks cool, the customer may be inclined to buy other products.

All in all, it's a pretty smart deal – especially for a company the size of HP.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

Tags: Logoworks