Connecticut Snubs Oracles Conciliatory Efforts

Connecticut on Thursday shrugged off a conciliatory letter sent the day before by Oracle Corp. Chairman and CEO Larry Ellison, as Attorney General Richard Blumenthal vowed to continue to seek relief and to consult with consumers and other states on its antitrust suit against Oracle.

“Nothing we have learned so far has diminished our determination to pursue this antitrust enforcement action filed yesterday in federal court seeking to protection competition and consumers from an unlawful takeover attempt,” Blumenthal said in a statement. “Oracle has indicated that it will shut down and end innovation in PeopleSoft product lines, including recent statements attributed to Mr. Ellison himself, and a statement apparently in the past 24 hours by Oracle CFO Jeff Henley that Oracle would not offer PeopleSoft products to new clients and would work to naturally wind down existing clients reliance on PeopleSoft software.”

Blumenthals words are a flat-out rejection of Ellisons promises that Oracle would continue to support PeopleSofts products. Ellison on Wednesday sent a letter to Connecticut leaders in which he said that consumers will “be able to purchase additional PeopleSoft licenses,” and that Oracle “will protect the significant technology investments that all customers have made,” he wrote.

Meanwhile, PeopleSoft Inc. joined Connecticut in its commitment to spurning Oracle, announcing on Wednesday that it had commenced an exchange offer for all outstanding shares of common stock of J.D. Edwards & Co.

PeopleSoft is offering J.D. Edwards stockholders either cash or PeopleSoft common stock with a value equal to $7.05 in cash plus the value of 0.43 of a PeopleSoft common share for each share of J.D. Edwards common stock they own.

Based on PeopleSofts closing per-share stock price of $16.92 on June 13, 2003—the trading day immediately prior to its announcement of the amended merger agreement—J.D. Edwards stockholders would receive $14.33 per share. That would make a total transaction value of about $1.75 billion (based on 122.4 million J.D. Edwards shares outstanding).