More Trials Ahead for

By Renee Boucher Ferguson  |  Posted 2004-09-09 Print this article Print

Oracle"> While the decision removes a big roadblock to the acquisition, proposed last summer, it does not mean the deal is done. Oracle still has a number of challenges to meet: it must face down PeopleSofts board of directors, who are unanimously against the deal; have PeopleSofts poison pill anti-takeover measure removed in court from PeopleSofts bylaws; and convince PeopleSoft shareholders to tender the majority of their shares to Oracle. In addition, there is a ruling from the European Commission hanging in the balance.
Read more here about the EUs process on the Oracle-PeopleSoft case.
Shortly after the Judges ruling was announced, Oracle publicly released a letter it sent to PeopleSofts board of directors, requesting the board reconsider its previous recommendations to reject Oracles offer. It also extended its offer for the eleventh time, to midnight on Sept. 24. Its previous tender offer was set to expire today. Oracles civil trial to stop PeopleSofts poison pill measure is scheduled to begin trial Sept. 27 in the Delaware Chancery Court. The so-called poison pill could reward some PeopleSoft customers between two and five times their license fees if Oracle stops support within a specified time frame, of PeopleSoft applications. PeopleSoft too has an upcoming civil trial to have Oracles tender offer lawfully removed on the grounds that it is harmful to PeopleSofts business. The company is seeking $1 billion plus punitive damages from Oracle. That trial is set to begin on Nov. 1 in Oakland, Calif.,. In a statement released following the Thursday decision, PeopleSoft said its board of directors will review the Courts ruling carefully. It noted that the Justice Department "has 60 days to decide whether it will appeal the Courts ruling to the Ninth Circuit Court of Appeals and that the review by the European Commission of Oracles bid is ongoing." Microsoft Corp.s plans for the enterprise software market found its way into the proceedings. Click here to read more. Meanwhile, the European Commission is awaiting additional information from Oracle before it makes its decision. If it determines that the deal would be anticompetitive, a combined Oracle and PeopleSoft would be barred from doing business in Europe. With so much hanging in the balance, some customers showed that "fatigue" may have set in over the case, voicing little concern about the final outcome. William Kragh, vice president of the financial control group at Chicago-based Harris Trust and Savings Bank, and a PeopleSoft Financials customer, said hed have to withhold judgment on the DOJs ruling until he learned more about what it meant. "You really have to wonder what [Larry Ellison] wants with [PeopleSoft]," he said. "Its been more than a year now. Its gone on for so long." Click here to read about DaimlerChryslers worry that a PeopleSoft buyout could cost it $50 million to $100 million to buy replacement software. Despite the remaining hurdles, Redwood Shores, Calif.-based Oracle remains upbeat. "This decision puts the onus squarely on the board of PeopleSoft to meet with us and to redeem their poison pill so that the shareholders can accept our offer," said Oracle chairman Jeff Henley, in a statement. Oracles offer for PeopleSoft stands at $21 per share. A PeopleSoft representative was unavailable for comment. Editors Note: This story was updated to include information and comments from Oracle and DOJ representatives as well as customers. Check out eWEEK.coms Enterprise Applications Center at for the latest news, reviews and analysis about productivity and business solutions.

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