Oracle officially closes PeopleSoft acquisition
- 10 January, 2005 08:00
As expected, Oracle closed its US$10.3 billion acquisition of PeopleSoft on Friday, putting an end to a rancorous 18-month struggle between the two companies and making PeopleSoft, once the number two supplier of enterprise application software, a wholly owned Oracle subsidiary.
Oracle filed a merger certificate with the Secretary of State's office for the State of Delaware on Friday morning, making the takeover official, said Bob Wynne, an Oracle spokesman. "The acquisition paperwork is complete and we are well into the process of integrating the two companies," he said.
PeopleSoft's shareholders had agreed to sell more than 97 percent of the company's outstanding stock, or about 388.7 million shares, by the time Oracle's latest tender offer closed at 8 p.m. Eastern Time Thursday, the company said. Oracle had already secured enough stock to give it control of the company but needed at least 90 percent to bring the deal to a rapid close, Wynne said.
The merger will make Oracle the world's second-largest seller of business applications software behind Germany's SAP. Oracle has said it needs the acquisition to give it the size and heft it requires to compete effectively in the applications market.
Oracle's hostile takeover bid was initially rejected by PeopleSoft's management and opposed by U.S. antitrust regulators, who said it would harm competition and lead to higher prices. A California judge rejected that argument in September, and on Dec. 13 Oracle announced that PeopleSoft had agreed to be acquired for US$26.50 per share.
The remaining three percent of PeopleSoft shareholders who have not yet tendered their shares will be paid the US$26.50 offer price, Wynne said. "Some people assume the shares will be transferred to Oracle stock, but they won't," he said.
Oracle has said it will release an upgrade to PeopleSoft's main product lines, but eventually it plans to build a single product suite that merges what it sees as the best features and modules of the two companies' products.
Oracle has set Jan. 14 as the date for notifying employees who will be laid off as a result of the deal, and plans to make a webcast to customers and partners on Jan. 18 to elaborate on its plans for the merged company.