I remember reading a long time ago that Microsoft helped Apple survive, and in return Apple gave Microsoft a lot of shares at dirt cheap prices (they weren’t dirt cheap back then because Apple’s range of products was exciting only to its very few fanatics). Additionally, it seems that also Apple agreed not to sue Microsoft over anything anymore – this non-public agreement seems that it’s still enforced by Apple (which, by the way, surpassed Microsoft when it comes to market capitalization back in 2010) until this very moment.

According to several resources, Microsoft gave $150 million to Apple in return for 18.18 million AAPL shares priced each at $8.25 back in 1997. Now how much was AAPL back in 1997? Well, let’s look at the below chart:

We can easily see from the chart above that AAPL did not even break the $7 level back in 1997 – so, was Microsoft suckered into this deal? Well, apparently not, as stated earlier, the deal was publicly about helping Apple, but secretly about buying Apple’s silence about the patents’ claims. Microsoft was a clear winner back then, but in retrospect, I’m sure that neither Bill Gates nor Steve Ballmer (one of the world’s worst CEOs in 2011) were the real winners – it was Apple.

Microsoft held these shares for a while and then sold them for an undisclosed amount, probably back in 2000 (for a healthy profit of almost half a billion, most likely when Apple was trading at the $33 level – just before the NASDAQ collapse of 2000).

Now, what if Microsoft did not sell its AAPL shares?

Well, first of all, Microsoft would have owned about 2% of the world’s most valuable company, and, the 18.18 million shares would have added $9.26 billion to Microsoft’s value (at the current price of about $509.46 for AAPL).

Was it a wise move for Microsoft to sell its Apple shares? This is the stock market, and regretting a buy trade or a sell trade is the worst thing that an investor can do. But, again, was it wise? I think the answer to this question would be, if they knew then what they know now – and if they did, they probably wouldn’t have given the money to Apple in the first place and left it to die.

Microsoft now owns a few percent of Facebook. Will it sell these shares at one point? And more importantly, will it wish it didn’t sell in the future? Only time will tell!

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