EU Clears Obstacle to Takeover of PeopleSoft
The European Union's executive body has announced it could find no reasons to stop Oracle's hard-fought battle to take over PeopleSoft Inc., clearing the last antitrust barrier in Oracle's way.
The Wall Street Journal reported Wednesday that the European Commission studied the proposal for more than a year and cleared it without conditions. The EU concluded that the presence of PeopleSoft in the business-applications software market didn't "necessarily give rise to more aggressive discounting" and that a larger Oracle wouldn't hurt competition. The commission said other companies, such as Lawson Software Inc. and Microsoft Corp. of the U.S., could compete with a merged Oracle-PeopleSoft.
Oracle has offered PeopleSoft $21 a share, or $7.7 billion. PeopleSoft rejected the offer and said it did not reflect the company's “real value,” the Journal reported.
Observers say that Oracle's legal attempts in the U.S. to overturn PeopleSoft's anti-takeover provisions are unlikely to be successful and that Oracle may have to take its proposal directly to shareholders at PeopleSoft's annual meeting. The other alternative is to persuade the board at PeopleSoft to negotiate a deal.