Oracle increase offer in 'final' PeopleSoft bid
Oracle increase offer in 'final' PeopleSoft bid
Oracle has made what it claims is a last attempt to acquire rival enterprise software maker PeopleSoft, having raised the price of its cash tender offer to purchase all of the outstanding shares of PeopleSoft to US$26 per share, or approximately US$9.4 billion.
This latest offer represents an increase of almost 19 percent over PeopleSoft's share price of US$21.89 at close of play on Tuesday.
It is the second time that Oracle has increased its offer per share since it launched its hostile takeover bid back in June last year, but while the previous increase – from US$16 to US$19.50 - still fell somewhat below the current market price, this latest and – according to Oracle – final offer presents PeopleSoft shareholders with the opportunity to make a significant premium on their shares compared to the current market value and so could prove tempting.
Jeff Henley, Oracle's Chairman and CFO, encouraged PeopleSoft shareholders to give the offer serious consideration.
"Given PeopleSoft's current prospects, including its recent downward revisions to earnings guidance for the first quarter, we believe our offer presents compelling value to PeopleSoft's stockholders. Oracle remains fully committed to completing this deal on terms that will benefit the stockholders of both companies."
Oracle still awaits a decision regarding antitrust approval from the US Department of Justice, but expects to receive this by March 12, and as such is extending the tender offer for all of the common stock of PeopleSoft to midnight EST on the same date. The offer was previously set to expire at midnight EST on Friday, February 13, 2004.
"We believe this acquisition is pro-competitive, will benefit the customers of both companies, and will make Oracle an even more profitable company," said Oracle's CEO, Larry Ellison. "We stand by our pledge to support the PeopleSoft customer base and provide enhanced support for PeopleSoft products."
As previously announced, Oracle has nominated five independent candidates for PeopleSoft's Board of Directors and has put forth a stockholder proposal to increase the size of PeopleSoft's Board from eight members to nine, with a view to hold a majority vote on the Board. PeopleSoft scheduled its annual stockholder meeting for March 25.
"This is our final price. We urge PeopleSoft's directors to seriously consider our offer and put the interests of their stockholders first," added Henley.
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