20 years ago Apple re-hired Steve Jobs by buying his struggling startup for $400 million

Steve Jobs 1996In hindsight, the firing of Steve Jobs from Apple seemed like one of the biggest mistakes of all time.

This has been much discussed in the years since Apple rebounded under Jobs to become one of the most innovative, powerful, and profitable tech companies of all time.

But the re-hiring of Jobs to Apple often gets a lot less attention. That happened 20 years ago on Tuesday.

Apple bought Jobs’ 11-year-old company, NeXT Software, for a $400 million.

Specifically, Apple agreed to pay about $350 million in cash and stock for the privately held NeXT and an additional $50 million to cover its debts, reported CNET at the time. 

To put that in terms adjusted for inflation, the $400 million price tag in 1996 would be like about $613 million today. And that’s for a company that wasn’t considered in its time to be much of a commercial success. The pricey NeXT computers never sold well and the company eventually left the hardware business to concentrate on software. 

Parts of the NeXT software wound up in the next generation of the Mac operating system.

When Apple announced the purchase, it was sort of vague what Jobs’ role would be. The company said only that he would report to Apple’s then-CEO and chairman Gil Amelio.

But Jobs wasn’t built to report to someone else at a company that he founded. By September, Amelio was out and Jobs was named interim CEO. Then the “interim” was dropped. And the rest, shall we say, is history.

Just for fun, here’s the first paragraph from the press release announcing that Apple had bought NeXT:

Apple Computer, Inc. today announced its intention to purchase NeXT Software Inc., in a friendly acquisition for $400 million. Pending regulatory approvals, all NeXT products, services, and technology research will become part of Apple Computer, Inc. As part of the agreement, Steve Jobs, Chairman and CEO of NeXT Software, will return to Apple – the company he co-founded in 1976 – reporting to Dr. Gilbert F. Amelio, Apple’s Chairman and CEO.

And here’s the visual that went with the press release.

NeXT Apple mergerGetty/Bob Riha Jr 

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