Oracle's bid for PeopleSoft looked rather like an attempt to undermine a competitor and confuse the market, and PeopleSoft filed a lawsuit against Oracle, accusing it of trying to destroy its business. But the Californian database company has just increased its bid by a third, and it's now offering to buy shares for more than the stock market price.
CNet reports: "Oracle's increased bid of $26 a share represents a 15% premium over the $22.70 closing price of PeopleSoft's shares on Wednesday. It's also ... in the range of where several Wall Street analysts are forecasting PeopleSoft's share price to be trading in the next 12 months, strengthening Oracle's position as it seeks shareholder approval to replace half of PeopleSoft's directors in a March 25 election."
"This completely changes PeopleSoft's strategy. This now puts PeopleSoft on the defensive and its board nominees at risk," said Rick Grubaugh, a senior vice president at proxy solicitor D.F. King & Co. "Because the stock used to trade above the offer price, it eliminated the need for the board to accept the offer. Now the board can't hide behind the fact it is not a credible bid."
However, both the US Justice Department and EU regulators are still examining the deal to see whether it is anti-competitive, and decisions are not expected until next month.
