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Technology Stocks : PSFT - 1999: The "Make-It-or-Break-It" Year? -- Ignore unavailable to you. Want to Upgrade?

To: AugustWest who wrote (1233)	6/15/2003 8:11:32 PM
From: SemiBull	Read Replies (1) \| Respond to of 1274

I betcha PSFT trades below $16 at some point in the near future However, since the ORCL offer is for cash instead of a stock swap I imagine it will lend a good amount of support right around $16. Just thinking out loud. An interesting Q...though I think $16 will be a base. PeopleSoft Sues to Block Takeover Bid Friday June 13, 9:41 pm ET By Lisa Baertlein PALO ALTO, Calif. (Reuters) - PeopleSoft Inc. (NasdaqNM:PSFT - News) filed suit on Friday in a California court to block Oracle Corp.'s (NasdaqNM:ORCL - News) $5.1 billion hostile takeover bid, the latest salvo in an increasingly heated battle between the rival business software companies. ADVERTISEMENT "Oracle has deliberately embarked on its unlawful campaign to injure PeopleSoft, and to cripple its ability to compete," PeopleSoft said in its lawsuit, filed in Alameda County Superior Court. Oracle, which is standing by a $16-share, all-cash offer that is below PeopleSoft's closing stock price of $16.92, said the merger question would be decided by PeopleSoft shareholders and not by "frivolous litigation." "PeopleSoft seems to have revived its on-again, off-again litigation strategy," Oracle spokesman Jim Finn said, referring to an earlier threatened lawsuit from PeopleSoft. The legal maneuver comes on the heels of two complaints filed on Thursday by PeopleSoft's intended merger partner J.D. Edwards & Co. (NasdaqNM:JDEC - News), which is seeking an injunction against Oracle and $1.7 billion in damages. "What you're seeing right now is a concerted effort by both PeopleSoft and J.D. Edwards to thwart the Oracle move," Paul Crisci, managing director of Broadview International's West Coast mergers and acquisitions office, told Reuters. Crisci, who is not involved in the deal, said the companies were hoping to create a legal distraction to slow the momentum of Oracle, as they push ahead with their merger plans. 'LOW-BALL' In its lawsuit, Pleasanton, California-based PeopleSoft alleged Oracle engaged in unfair trade practices and asked the court for unspecified damages, saying Oracle's "low-ball offer" was aimed at derailing the merger with J.D. Edwards. PeopleSoft, which makes software that automates business functions like accounting and human resources, said Oracle was out to poach customers "through a concerted campaign of fear, uncertainty and doubt." PeopleSoft has argued that Oracle's proposed takeover would require months of scrutiny from antitrust regulators since it would eliminate a competitor from the three-way race between PeopleSoft, Oracle and market leader SAP AG. (XETRA:SAPG.DE - News) Attorneys said Oracle's plan to stop sales of PeopleSoft products and take its customers raised obvious red flags for regulators but said it was not certain the merger would be blocked. "You don't normally spend money to buy a company and shut it down unless you expect in the future you'll face competition. That may be investigated," said attorney Charles Biggio, a former top official at the Department of Justice's Antitrust Division. Regulators may get help from PeopleSoft, which as a reluctant seller could be more willing than the average acquisition target to raise antitrust issues, he said. J.D. Edwards has even more flexibility to highlight such concerns since unlike PeopleSoft it would not face the prospect of having to reverse its stance if Oracle were to sweeten its offer, Biggio said. "We think that the DOJ is likely to rely heavily upon testimony of the customers of the companies and this will certainly determine if choice and or prices may be negatively impacted," Andrew Whittaker, who does arbitrage research at Lehman Brothers, said in a conference call on Friday. Oracle Chief Executive Larry Ellison said Conway had approached him one year ago about buying Oracle's applications software business -- and never raised any antitrust concerns then. A combined Oracle and PeopleSoft would have only 10 percent of the business, compared with the 18-percent share held by market leader SAP AG, Ellison said. Meanwhile, PeopleSoft said on Friday its board had approved a sweetened package that would pay Chief Executive Craig Conway $1 million -- twice his base salary -- plus bonuses in the event that the software maker is taken over. The sweetened package was approved in May, before Oracle Corp. launched its unsolicited bid, a company spokesman said. (Additional reporting by Kevin Krolicki in Los Angeles)