Oracle finally gets PeopleSoft
- By Michael Hardy
- Dec 12, 2004
After more than a year of trying, Oracle officials have convinced PeopleSoft's board members to accept a deal to merge the two companies.
Officials announced today that they signed a merger agreement that would allow Oracle to buy PeopleSoft for $10.3 billion in a deal expected to close next month. Both companies' boards of directors have approved the move.
"This merger gives Oracle even more scale and momentum," according to a statement from Oracle chief executive officer Larry Ellison that announced the agreement. "The real highlight of our most recent quarter was the 57 percent growth in our applications business, and this merger is going to make that applications business bigger and stronger."
Ellison pledged continued support for PeopleSoft products. "We intend to enhance PeopleSoft 8 and develop a PeopleSoft 9," he said. Oracle will also continue to support and develop software from J.D. Edwards, a business software company acquired last year by PeopleSoft.
George Battle, chairman of PeopleSoft's transaction committee, said the latest Oracle offer represents a good value for the company's shareholders. Oracle officials had raised their offer from $24 a share to $26.50 a share.
Agency officials who use PeopleSoft products should prepare for change, said consultant Chip Mather, senior vice president of Acquisition Solutions.
"The people who are currently using PeopleSoft will eventually find themselves migrated over to an Oracle solution," he said. "Oracle can't afford to [anger] all those people who are using PeopleSoft, so they're going to have to find as much as possible a painless migration strategy."