Shareholders Last Chance

By John Pallatto  |  Posted 2004-11-09 Print this article Print

?"> In that case, this latest move is aimed at impressing shareholders that this could very well be their last chance to tender their shares. They shouldnt stay on the sidelines waiting for the resolution of legal issues before deciding to accept the offer. Its time to put up or shut up. Thats because the court is clearly looking for a sign that a majority of shareholders is truly willing to accept the buyout offer. If Oracle gets offers for a majority or perhaps even a large percentage of the outstanding shares, the company can argue—and the court could find—that PeopleSoft anti-buyout measures are an unfair attempt to thwart shareholders will.
To read about the European Commissions decision that an Oracle buyout of PeopleSoft would not violate antitrust law, click here.
But if Oracle fails to win commitments from significantly more shareholders than from previous offers, then it makes sense to withdraw its offer and abandon the lawsuit rather than wait for the court to rule that the anti-takeover measures are legal. That would make it even more difficult to persuade the court to invalidate the protections if Oracle decided to make another buyout bid later. Abandoning the lawsuit leaves it open to a renewed buyout attempt if PeopleSoft struggles to make money during 2005. Of course, there is another possibility: that Oracle has actually concluded that it just cant prevail in this takeover and its time to cut its losses, walk away and turn its attention to other business prospects. Despite the evidence, its still hard to believe, considering the tenacity with which it has pursued PeopleSoft. But Oracle has no choice if it can neither get shareholders to throw themselves into its arms nor persuade the court to remove the anti-takeover protections. Perhaps Oracle has decided it has sufficiently delayed and hampered PeopleSoft business plans for as long as it possibly can. In any event, it would be a welcome development for PeopleSoft and the ERP (enterprise resource planning) market if this hostile takeover is put to rest–finally and, with luck, permanently–by the end of the month. Check out eWEEK.coms for the latest news, reviews and analysis about productivity and business solutions.

John Pallatto John Pallatto is's Managing Editor News/West Coast. He directs eWEEK's news coverage in Silicon Valley and throughout the West Coast region. He has more than 35 years of experience as a professional journalist, which began as a report with the Hartford Courant daily newspaper in Connecticut. He was also a member of the founding staff of PC Week in March 1984. Pallatto was PC Week's West Coast bureau chief, a senior editor at Ziff Davis' Internet Computing magazine and the West Coast bureau chief at Internet World magazine.

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