Oracle to BEA: Get in Mah Belly!
If we maintain our trajectory and IBM maintains their trajectory, we could pass them as early as the end of this year or certainly next year to be the No. 2 player in middleware.”
Carl Icahn’s recent appeals to BEA Systems management to discuss a possible sale of the company seem to have set Oracle’s salivary glands flowing. This week the CRM gourmand made an unsolicited $6.66 billion bid for the business-management software maker.
In a letter to BEA’s board Tuesday, Oracle offered $17 a share for BEA–a 25% premium over BEA’s closing stock price yesterday. “We believe our all-cash offer provides the best value for BEA’s shareholders and the best home for BEA’s employees and customers,” said Oracle President Charles Phillips. “This proposal is the culmination of repeated conversations with BEA’s management over the last several years. We look forward to completing a friendly transaction as soon as possible.”
We’ll have to see about that. According to Kevin Faulkner, BEA’s senior vice president of investor relations, the company’s not for sale. ‘Course, PeopleSoft CEO Craig Conway said the same thing back in 2003 and look how that turned out.
Anyway, if Tuesday’s offer leads to a deal, Oracle will have spent some $28 billion on acquisitions–33 of them–in the last three years or so. A vast sum, but one apparently well spent. The company’s recent purchases have been widely credited for a 26% spike in earnings in its latest fiscal year and for a 91% increase in its stock price since November 2005. If things continue along that way, we may see Larry Ellison’s IBM prediction come to pass sooner, rather than later.
Comments
The company may not be for sale, at least not to Oracle. BEA may want to partner with another company.
“With SAP (SAP) buying Business Objects (BOBJ) for $59.35 cash per share, it was just a matter of time before archenemy Oracle (ORCL) would make a move to close the gap. Oracle responded by bidding for BEA Systems Inc. (BEAS) only to be rejected by the board as being too low, several hours later. This implies that the attempt was a knee-jerk reaction that was not coordinated with BEAS.”
See full article: http://www.crossprofit.com/article.asp?id=126
I agree with your conclusion that Oracle is still in the market for more acquisitions.
Saul Sterman
Posted by Saul Sterman at October 14th, 2007 at 6:28 pm