Oracle Fully Compliant with the DoJ

Oracle Corp. is fully compliant with the US Department of Justice's second request for information regarding its tender offer for PeopleSoft, according to Chuck Phillips, Oracle's co-president. What will be the DoJ's response?

San Diego, Calif— Oracle Corp. is fully compliant with the US Department of Justices second request for information, according to Chuck Phillips, Oracles co-president.

During a media Question and Answer session at Oracles annual user conference, AppsWorld, held in San Diego this week, Phillips addressed the topic of Oracles ongoing and increasingly bitter battle to acquire rival PeopleSoft Inc. The proposed acquisition is under antitrust investigation by the DoJ, the European Commission, and more than half the States Attorneys General.

The DoJ first began investigating the proposed deal shortly after Oracle announced its tender offer for PeopleSoft last June. In the fall, the DoJ made a second request for information - which signaled for many the DoJs seriousness regarding the matter. The outcome of the DoJs current investigation has hinged on Oracles ability to comply with the request for information, as the DoJ cannot move forward with its decision until it has received every bit of data it has requested.

"The gating factor is regulatory approval," said Phillips. "We have complied with all the [DoJ] requests are are waiting for a decision. All the information is out there."

At the same time, Oracle cannot move forward with its acquisition attempt until the DoJ announces its decision. Should the DoJ decide the proposed acquisition is not anticompetitive to the software industry, Oracle is free to continue its tactics to acquire PeopleSoft. If the DoJ, on the other hand, decides a merger would be anticompetitive, the deal is off.

Oracle, of Redwood Shores, Calif., said it expects a decision from the DoJ sometime in March.

A DoJ spokesperson was not available for comment.

A decision from the European Commission has been put on hold while that body gathers more information. Likewise, the investigation by the States Attorneys General is ongoing.

PeopleSoft, for its part, has continually rebuffed Oracles $19.50 tender offer, which its board members agree undervalues the company. PeopleSoft, of Pleasanton, Calif., is trading well above above Oracles asking price. The company is scheduled to announce its quarterly earnings on Thursday. There is speculation that with strong quarter earnings, Oracle will be forced to increase its offer.


Phillips declined to comment on whether or not Oracle will look to raise its bid after PeopleSofts earnings announcement.

The acquisition battle is being waged on other fronts as well. Earlier this week Oracle announced its slate of nominees for PeopleSofts Board of Directors— a move that, if successful, would do much in favor of Oracles acquisition play, and force PeopleSoft to remove its poison pill anti-takeover measure through a board vote. PeopleSoft shareholders will cast their votes for new board members at the annual shareholders meeting this spring, with Oracle sending out blue proxy voting cards to all stockholders, and PeopleSoft sending out white cards to the same constituency.