Date set for PeopleSoft boardroom battle

By Stuart Finlayson

Enterprise application software maker PeopleSoft has set a date of March 25th for what is set to be a tussle for control of its boardroom with rival software maker Oracle, when it holds its annual shareholder meeting and director election.

Oracle, which has been pursuing a hostile takeover of PeopleSoft since June last year, has nominated replacements for four PeopleSoft board members who are up for re-election. As the number of board members up for re-election represents half of the board, Oracle has proposed an increase in the number of board members to nine, and has proposed a fifth individual to fill that additional spot, which would give it a 5-4 controlling interest on the board.

In a statement, PeopleSoft called on its shareholders to help the company put an end to Oracle's attempts to "disrupt our business" by voting in favour of the board's nominees and rejecting Oracle's nominees.

"We believe that Larry Ellison's attempt to gain control of PeopleSoft's Board of Directors is solely to advance Oracle's agenda and is not in the best interests of PeopleSoft's stockholders. We strongly believe that Ellison's hand-picked, paid nominees are biased and would have irreconcilable conflicts of interest if elected to PeopleSoft's board. Each nominee is receiving cash compensation and has signed an agreement with Oracle. We believe their ability to be independent is seriously compromised."

Oracle's bid remains subject to approval from antitrust officials from the US Department of Justice and the European Commission. It is also trying to have abolished a money back guarantee established by the PeopleSoft board, dubbed a "poison pill" by Oracle, which could make Oracle liable for over US$1.5 billion in compensation payments to PeopleSoft customers should it acquire the company.

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