6 June 2003 Oracle, the world’s second largest software company, has made a surprise $5.1 billion bid to buy rival PeopleSoft — just four days after PeopleSoft announced it was acquiring JD Edwards.
Oracle is offering $16 per share for every share in PeopleSoft — a 6% premium over PeopleSoft’s closing price yesterday of $15.11.
According to CEO Larry Ellison, Oracle has no plans to actively sell PeopleSoft products to new customers if the acquisition goes ahead. Instead, it will incorporate features from PeopleSoft’s enterprise resource planning software products into future versions of the Oracle eBusiness Suite.
“The acquisition of PeopleSoft will immediately make Oracle an even more profitable and competitive company,” said Ellison in a press release.
Oracle chief financial officer Jeff Henley added: “Given PeopleSoft’s current prospects and plans, we believe our offer presents compelling value to PeopleSoft shareholders. We expect there to be substantial cost savings and minimal business integration risk.”
Regarding PeopleSoft’s planned acquisition of JD Edwards, Ellison said that Oracle would “review whether, and on what terms” it would support the JD Edwards deal.
Based on annual revenue figures, the combination of Oracle with PeopleSoft and JD Edwards would create a company with annual revenue of more than $12 billion.
PeopleSoft executives have so far been unavailable for comment.