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County Group Wants State to Block Oracle Bid

June 28, 2003|From Bloomberg News

California should file an antitrust lawsuit to block Oracle Corp.'s $6.3-billion hostile bid for rival business-software maker PeopleSoft Inc., a group of technology managers in California's county governments said.

Most of California's 58 counties use PeopleSoft programs, and it could cost them millions of dollars to switch to Oracle, the California County Information Services Director's Assn. wrote in a letter to state Atty. Gen. Bill Lockyer. The group gave a copy of the four-paragraph memo to Bloomberg News.

"This kind of acquisition neither benefits the markets nor enhances the products and solutions available to government" in California, the letter said. Connecticut has filed a suit to block the offer by the Redwood City, Calif., company.

Lockyer's office has "no plans at this point to intervene," said spokesman Tom Dressler.

The U.S. Justice Department was expected to decide by Friday whether to seek more information on the bid by Oracle, the nation's second-largest maker of business management software. Executives at PeopleSoft, the third-largest firm, and some customers have said they are concerned that such a deal might limit competition.

When Oracle Chief Executive Larry Ellison announced his bid June 6, he said he would stop selling PeopleSoft programs and would urge users to switch to Oracle's rival E-Business brand for tasks such as payroll and accounting. Later, he pledged to improve and develop PeopleSoft products for at least 10 years and not to force users to switch. Oracle spokeswoman Jennifer Glass said the purchase would help PeopleSoft customers.

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