Anatomy of Oracle's Multibillion-Dollar Sun Acquisition - Page 3

Feb. 23: Sun Chairman Scott McNealy meets with Larry Ellison, CEO of Oracle, concerning a possible strategic transaction.
Feb. 22 to Feb. 26: The Sun board holds three special meetings to discuss with management and advisers the revised IBM proposal and the status of discussions with Hewlett-Packard and Oracle. Sun management and advisers ask Hewlett-Packard to make a proposal for a transaction, but Hewlett-Packard does not do so. McNealy holds further discussions with Ellison.
Feb. 26 to April 4: Sun and advisers hold lengthy negotiations with IBM and its legal counsel, including negotiation of a draft definitive agreement for the transaction proposed by IBM. Sun's engagement with IBM focuses on the need to address issues of transaction certainty.

"In particular, we focused on optimizing the likelihood that a transaction with Party A [IBM] would receive approval from antitrust authorities, mitigating risks to our business if a transaction with Party A did not get antitrust approval and requiring Party A to close the transaction, if approved by antitrust authorities," the document reads.
During this time period, Sun's board meets six times "to discuss with management and advisers the status of negotiations with Party A, communications from Oracle, Party B and others seeking to discuss a potential transaction during this period and terminating the exclusivity arrangement with Party A, but the board and committee determined to continue negotiations with Party A and not to terminate the exclusivity arrangement," according to the document.
March 12: Oracle sends a letter to the Sun board proposing the acquisition of Sun's software assets, a minority equity investment by Oracle in common stock and entering into certain strategic relationships.
March 16: The Sun board meets with management and advisers to discuss Oracle's proposal and the board's fiduciary obligations. The board decides to continue negotiations with IBM and not to terminate the exclusivity arrangement with IBM to respond to Oracle's proposal.
March 18: The media reports that Sun is in discussions concerning a potential acquisition of the company. eWEEK discusses IBM as the likely buyer.
March 29: IBM communicates that it is reducing its offer for common stock from $10 per share to $9.40 per share and proposes other terms and conditions under which it would be prepared to move forward with the proposed transaction.

Chris Preimesberger

Chris J. Preimesberger

Chris J. Preimesberger is Editor-in-Chief of eWEEK and responsible for all the publication's coverage. In his 13 years and more than 4,000 articles at eWEEK, he has distinguished himself in reporting...