PeopleSoft Again Rejects Oracle's Overtures

by Glen Shapiro, LawAndTax-News.com, New York

23 November 2004

It emerged at the weekend that business software firm, PeopleSoft has rejected larger rival, Oracle's "best and final" takeover bid offer of $24 per share.

Although Oracle announced on Friday evening that it had won the support of the majority of PeopleSoft's shareholders for the deal, PeopleSoft disputed this, arguing that it did not believe, based on conversations with large shareholders, that most of its investors would be satisfied with the price.

Following this rejection of Oracle's offer, the larger firm has extended its deadline from November 19 to December 31, in order to allow investors that tendered their shares to seek their return.

Although the proposed merger has been cleared by both the European Commission and the US Department of Justice, court proceedings are set to begin on Wednesday with the intention of dismantling PeopleSoft's 'poison pill' measures, which are designed to make a hostile takeover prohibitively expensive.

According to observers, if Oracle fails to secure a victory over PeopleSoft in the courts, it may seek to nominate its own candidates for the PeopleSoft board at the latter's annual meeting next spring. Meanwhile, PeopleSoft is reported to be hoping for a high performing fourth quarter in order to convince its shareholders that the $24 per share bid undervalues the firm.

Recommended