A lowball offer from Oracle:
Oracle offers to buy PeopleSoft for $5.1 billion
NEW YORK, June 6 (Reuters) - Oracle Corp., the world's No. 2 software maker, on Friday said it had offered to buy rival PeopleSoft Inc. for $5.1 billion, four days after PeopleSoft said it would acquire another rival, J.D. Edwards & Co. <JDEC.O>.
A PeopleSoft <PSFT.O> spokeswoman said she was not aware of the Oracle offer and declined to comment.
Oracle <ORCL.O> offered to pay $16 a share, which represents a 6 percent premium over PeopleSoft's closing price of $15.11 in Thursday Nasdaq trading. Peoplesoft shares rose to $18.40 in pre-open trading this morning.
"The acquisition of PeopleSoft will immediately make Oracle an even more profitable and competitive company," Oracle Chief Executive Larry Ellison said.
Oracle's chief financial officer, Jeff Henley, said the acquisition would increase the combined companies' earnings from the first quarter after completion of the deal.
On Monday, PeopleSoft said it would buy J.D. Edwards & Co. for $1.6 billion in a deal expected to close this autumn.
Oracle said that if its bid for PeopleSoft was successful, it would review whether to support the acquisition of J.D. Edwards and the terms of such a deal.
Oracle's acquisition of PeopleSoft would be subject to regulatory approval and the amendment of PeopleSoft's shareholder rights plan, among other closing conditions, but would not be subject to performance of due diligence or financing.
Oracle said it expects to begin a tender offer for PeopleSoft shares on Monday. Credit Suisse First Boston has provided bridge financing and is advising Oracle on the transaction.
Oracle said it expects earnings of 14 cents to 15 cents a share for the fiscal fourth quarter, which began on March 1. The average Wall Street estimate is 14 cents, with estimates ranging from 12 cents to 15 cents, according to Reuters Research.
A year earlier, Oracle posted a profit of 12 cents a share. Excluding a one-time charge, it earned 14 cents a share.
06/06/03 07:57 ET
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