Oracle Corp. appears set to complete its long-sought takeover of PeopleSoft Inc. unless its rival becomes more profitable and proves it is worth more than the $9.2 billion bid on the table.
The owners of about 61 per cent of PeopleSoft's stock implicitly endorsed Oracle's latest $24-per-share offer by tendering their shares before a pivotal weekend deadline.
Had most of the shareholders followed the advice of PeopleSoft's board and withheld their shares, Oracle planned to rescind its all-cash offer and end a 17-and-a-half month quest.
Despite the shareholder rebuff, PeopleSoft has indicated it is not ready to surrender, however, because its board believes the business software maker is worth at least $2 per share — nearly $800 million — more than its rival's current offer.
On Saturday, PeopleSoft's board of directors again unanimously concluded that Oracle's latest bid was inadequate, saying in a statement that a majority of the company's largest stockholders don't think the offer reflects the company's real value.
It is the sixth time that PeopleSoft's seven directors have snubbed its bitter rival since the takeover battle began.
Pleasanton, Calif.-based PeopleSoft can still hold out because it remains armed with an antitakeover measure known as a "poison pill" to thwart Oracle's advances. If Oracle acquires a 20 per cent stake in PeopleSoft, the company can trigger the poison pill to flood the market with new shares to make a takeover prohibitively expensive.