Welcome!

Open Source Cloud Authors: Elizabeth White, Zakia Bouachraoui, Liz McMillan, Pat Romanski, Yeshim Deniz

Related Topics: Open Source Cloud, Java IoT

Open Source Cloud: Article

'OK, $9.4 Billion Cash But Not a Penny More'

'OK, $9.4 Billion Cash But Not a Penny More'

Oracle has gone and done what it didn't want to do, but had to do if it's going to keep on pursuing PeopleSoft. It raised its bid from $19.50 to $26 a share or from $7.1 billion to $9.4 billion cash.

Larry Ellison, who started at $16 a share, swears the 33% sweetener is absolutely positively his final offer.

The price on offer is probably the only problem associated with Oracle's hostile tender offer that was easy to solve. Oracle just had to grit its teeth.

Oracle, whose sincerity about the acquisition has been in doubt, had to raise its price because PeopleSoft shares have been up over the $19.50 floor for months now.

Oracle moved when PeopleSoft shares were dipping. PeopleSoft's board, which may now be in something of a quandary and under some pressure, has said it will meet to consider the new price.

When last spotted, however, the quarry was doing what it could to prevent itself from being run to ground. In what it called an effort to bring its situation with Oracle to a head, PeopleSoft moved up its annual stockholders meeting by two months to March 25.

PeopleSoft stockholders are supposed to vote on who they want on the board at the meeting.

Oracle of course is making moves to pack the board with Oracle friendlies. PeopleSoft has four incumbents it wants re-elected. Oracle, which needs the PeopleSoft bylaws changed for its scheme to work, is fielding a slate of five alternates. If they get on the board, the board would quit voting again Oracle's hostile bid.

Then again, at some point between now and then the Justice Department could finally render its decision on whether it would allow an Oracle-PeopleSoft merger. The latest speculation suggested the agency will quash it.

Meanwhile, PeopleSoft posted its fourth-quarter earnings. Sales were up 34% to $685.2 million and profits dropped 70% to $17.4 million, or five cents a share, because of costs associated with its JD Edwards acquisition. Without those costs, earnings would have been 20 cents. License revenues were up 29.5% to $185.4 million. PeopleSoft CEO Craig Conway said, "It could have been a better year."

The company lowered its guidance for this quarter to $625 million-$635 million with license revenues of $130 million-$140 million and earnings of 17 cents or 18 cents. Its year is supposed be backend-loaded but one Wall Streeter cracked that the company didn't benefit from the Q4 upside and is taking advantage of Q1's seasonal downturn.

PeopleSoft's announcement gave Oracle the opportunity to wade in and say that, "We are not surprised that PeopleSoft management wants its shareholders to vote on its board slate before they have a chance to see the results of the first quarter, particularly since PeopleSoft just lowered its guidance for the quarter."

By the way, that cute little refund program PeopleSoft put in place to ward Oracle off had a liability of $1.5 billion at the end of December. A total price of, like, $12 billion might be a little steep for Oracle shareholders to countenance.

Oracle has $8.1 billion in cash and a $1.5 billion credit line. The tender offer is supposed to run till March 12. Presumably Oracle expects a decision from the DOJ by then.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

Comments (0)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


IoT & Smart Cities Stories
There are many examples of disruption in consumer space – Uber disrupting the cab industry, Airbnb disrupting the hospitality industry and so on; but have you wondered who is disrupting support and operations? AISERA helps make businesses and customers successful by offering consumer-like user experience for support and operations. We have built the world’s first AI-driven IT / HR / Cloud / Customer Support and Operations solution.
Codete accelerates their clients growth through technological expertise and experience. Codite team works with organizations to meet the challenges that digitalization presents. Their clients include digital start-ups as well as established enterprises in the IT industry. To stay competitive in a highly innovative IT industry, strong R&D departments and bold spin-off initiatives is a must. Codete Data Science and Software Architects teams help corporate clients to stay up to date with the mod...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
Druva is the global leader in Cloud Data Protection and Management, delivering the industry's first data management-as-a-service solution that aggregates data from endpoints, servers and cloud applications and leverages the public cloud to offer a single pane of glass to enable data protection, governance and intelligence-dramatically increasing the availability and visibility of business critical information, while reducing the risk, cost and complexity of managing and protecting it. Druva's...
BMC has unmatched experience in IT management, supporting 92 of the Forbes Global 100, and earning recognition as an ITSM Gartner Magic Quadrant Leader for five years running. Our solutions offer speed, agility, and efficiency to tackle business challenges in the areas of service management, automation, operations, and the mainframe.
The Jevons Paradox suggests that when technological advances increase efficiency of a resource, it results in an overall increase in consumption. Writing on the increased use of coal as a result of technological improvements, 19th-century economist William Stanley Jevons found that these improvements led to the development of new ways to utilize coal. In his session at 19th Cloud Expo, Mark Thiele, Chief Strategy Officer for Apcera, compared the Jevons Paradox to modern-day enterprise IT, examin...
With 10 simultaneous tracks, keynotes, general sessions and targeted breakout classes, @CloudEXPO and DXWorldEXPO are two of the most important technology events of the year. Since its launch over eight years ago, @CloudEXPO and DXWorldEXPO have presented a rock star faculty as well as showcased hundreds of sponsors and exhibitors! In this blog post, we provide 7 tips on how, as part of our world-class faculty, you can deliver one of the most popular sessions at our events. But before reading...
DSR is a supplier of project management, consultancy services and IT solutions that increase effectiveness of a company's operations in the production sector. The company combines in-depth knowledge of international companies with expert knowledge utilising IT tools that support manufacturing and distribution processes. DSR ensures optimization and integration of internal processes which is necessary for companies to grow rapidly. The rapid growth is possible thanks, to specialized services an...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
Scala Hosting is trusted by 50 000 customers from 120 countries and hosting 700 000+ websites. The company has local presence in the United States and Europe and runs an internal R&D department which focuses on changing the status quo in the web hosting industry. Imagine every website owner running their online business on a fully managed cloud VPS platform at an affordable price that's very close to the price of shared hosting. The efforts of the R&D department in the last 3 years made that pos...