Oracle, Sweetening Terms, Buys BEA
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Just three months after BEA handily rejected its original unsolicited bid, Oracle said it would acquire BEA Systems for $8.5 billion.
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Oracle Corp. , the largest database software maker, said on Thursday it would buy Hyperion Solutions Corp.  for $3.3 billion to boost its position in the fast-growing market for performance management software.
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BEA Systems Inc  said on Thursday it is willing to sell itself for $8.2 billion, but the price was rejected as "impossibly high" by Oracle Corp , the only company that has publicly expressed interest in the software maker.
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Given the silence from the BEA Systems and Oracle camps early this week about Oracle's unsolicited proposal to buy its middleware rival, the community at large can only sit back and guess what might be the next scene in this drama.The two companies have been keeping quiet since last Friday's blockbuster revelation that Oracle was seeking to acquire BEA for $17 per share, or about $6.7 billion. Both have spurned requests this week for media briefings to elaborate on the issue.Undoubtedly, much is taking place behind the scenes, as aggressive Oracle seeks to add BEA to the impressive list of formerly independent companies it has acquired, which has included, among others, PeopleSoft and Siebel Systems. BEA, meanwhile, also has to be pondering its next step.Officials at Sun Microsystems, which invented the Java platform that serves as the backbone of many BEA and Oracle products, seemed to be caught off-guard when asked about the proposed merger at a Sun event in San Francisco on Tuesday evening.Chuckling, Rich Green, Sun executive vice president of software, suggested contacting Oracle CEO Larry Ellison about the matter. But when asked what impacts might be felt by the Java platform itself, Green did not see any negative effects."They're both Java supporters," Green said. "I think it's neutral to Java. I think it's just fine."Sun's James Gosling, a founder of Java and chief technology officer for Sun's client software group, concurred. "They're both big supporters of Java. I don't think it's going to have much effect one way or the other," Gosling said.Oracle has pledged to protect investments customers have made in BEA products. While Oracle's move has been characterized in some circles as a hostile takeover attempt, BEA's initial response merely said the Oracle offer undervalued the company.Major BEA stockholder Carl Icahn has been prodding for a sale of BEA, prompting one BEA insider to suggest Icahn did not have enough shares and would have a hard time getting control of the BEA board of directors in order to make the sale happen. Now, Oracle has forced BEA's hand. If history is any indication, the sale is likely to happen. PeopleSoft opposed Oracle but eventually succumbed."We certainly saw how persistent Oracle was in chasing PeopleSoft," said Dennis Callaghan, enterprise software analyst at the 451 Group, who expects the merger to be completed.Options for BEA to resist Oracle may be limited. To take the company private and avoid a merger, BEA would need to find a private equity partner, Callaghan said. And then there is Icahn, owning a significant stake in the company and wanting the company sold."It's not like [BEA CEO and co-founder] Alfred Chuang can regain control of the company and take it private. He's got to make his shareholders happy," said Callaghan.Even BEA employees could profit on a merger if they bought stock at a discounted price and then were able to sell it at an inflated price as a result of a merger, he said.? They might lose their jobs at BEA, but a lot of them would be very employable, winding up with startup ventures, he said.Callaghan added he expects Oracle to increase its offer. HP is a possibility as another potential buyer for BEA, but HP has had troubles of its own integrating acquired companies, such as Peregrine and Bluestone Software, Callaghan saidHe gave credence to the notion that Oracle may be buying BEA to stock up on its middleware offerings as the database market, which has been Oracle's cash cow, now features free, open source offerings from competitors.? "From what I understand, [databases is] not really a growing business at this point, Callaghan said.A dignitary in the Java development space had a mostly positive reaction to the proposed merger."Oracle and BEA both have amazing engineering teams, but Oracle's business operation is clearly many, many times the size and scale of BEA's," said Rick Ross, founder of the Javalobby Web site for Java developers. Having both teams under the same umbrella would create great opportunities for innovation, Ross said. And BEA's technology, such as the JRockit Java Virtual Machine, could become more widely used, he said.But there could be a down side, Ross noted."As the realized market share of a single player moves to such a dominant position, it becomes less and less likely that the startup innovator can gain a foothold," he said.IBM, BEA, and Oracle are battling in what research firm IDC calls the application deployment software space, which is comprised of application servers, integration software, message-oriented middleware and transaction processing monitors. This market space, valued at $9.4 billion in 2006, is growing at nearly 18 percent year over year because of trends in integration, business process management, and SOA, said Maureen Fleming, IDC program director.When including software mainframes, IBM last year had a 36 percent market share, valued at $3.3 billion. BEA trailed with 11 percent or $1 billion, and Oracle had 9 percent, or $850 million. The figures include license and maintenance revenuesWhen leaving out mainframe software, the market size dropped to $6.5 billion, with IBM still leading with a 20 percent market share, or $1.3 billion and Oracle garnering 13 percent or $850,000. BEA came in right behind Oracle with 12 percent or $840,000.
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Oracle said Sunday that it was dropping its effort to acquire BEA Systems over disagreements surrounding the valuation of the company.
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The acquisition will boost Oracle's telecom offerings with Netsure's communications applications suite.
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Continuing its buying spree, Oracle has acquired a maker of employee role-mapping software.
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BEA Systems reiterated on Friday that it would not accept&#160;Oracle&#39;s $17 per share acquisition bid, and also said it would allow&#160;a deadline Oracle had set for Sunday 5 p.m. PDT&#160;to expire.In a public statement -- just the latest salvo in merger talks that have had a distinctly icy quality -- BEA&#39;s vice president of planning and development, William Klein told Oracle President Charles Phillips that the company&#39;s offer was &quot;unacceptable.&quot;&#160;BEA has said it would accept a $21 per share bid.That would result in an $8.3 billion price tag for the company, significantly more than Oracle&#39;s offer, which works out to $6.7 billion. BEA&#39;s stock was trading at about $16.80 per share midday Friday.&quot;As fiduciaries, our Board cannot endorse a proposal that it has concluded significantly undervalues BEA,&quot; Klein said in the statement. &quot;We therefore assume that your proposal will expire on October 28.&quot;An Oracle spokeswoman could not immediately be reached for comment.
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Business software maker BEA Systems Inc   has agreed to be acquired by Oracle Corp  for  $8.5 billion, a 14 percent premium to its first offer, the  companies said on Wednesday.
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Oracle's offer of $17 per share? No thanks, BEA says again--and this time, it's countering with what it sees as a better value for its shareholders.
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Oracle has rejected&#160;BEA Systems&#39; proposed purchase price of $21 per share, calling it &quot;impossibly high&quot; for Oracle or any other company to pay.
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The business software maker inks a deal with IBM, but it isn't likely to dissuade Oracle.
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Oracle Corp. , the world's top  database software maker, is near an agreement to buy Hyperion  Solutions Corp. , which makes software that lets  companies analyze and track their performance, for about $3  billion, The New York Times said Wednesday in its online  edition.
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BEA has told Oracle that it would, in fact, entertain an acquisition offer -- just not the one Oracle has proposed.
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BEA Systems has told Oracle the two companies can still make a deal -- just not the one on the table.
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We've already established what you are, now were just working out a price BEA blinked this morning and said it would enter takeover negotiations with Oracle, and anyone else thatâs interested, at a floor of $21 per share.â¦
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BEA Systems Inc  said on Thursday it is prepared to sell itself for $8.2 billion, which is a 24 percent premium to a bid from Oracle Corp  that the business software maker rejected.