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PeopleSoft, Oracle Battle Is Expected to Heat Up

September 01, 2003|From Associated Press

The software soap opera pitting PeopleSoft Inc. against its relentless suitor Oracle Corp. appears ready to heat up again, ending a brief lull in a drama that riveted Silicon Valley much of the summer.

Both Pleasanton, Calif.-based PeopleSoft and Redwood City, Calif.-based Oracle are staging a series of largely scripted events during the next two weeks to sway industry analysts and corporate customers to their sides of the battle.

There's also a chance for courtroom theatrics with a Thursday hearing scheduled on a PeopleSoft lawsuit seeking to paralyze Oracle's $7.5-billion hostile takeover bid for the company.

PeopleSoft already has tried to use the Alameda County Superior Court lawsuit to make Oracle look bad. Last week, PeopleSoft distributed a new version of the 2-month-old lawsuit that restored previously censored segments.

The unsealed portions featured e-mail snapshots of Oracle executives and employees discussing their desire to hurt PeopleSoft and influence industry analysts.

"We've certainly wounded [PeopleSoft]," an unnamed Oracle employee wrote in one of the unsealed e-mails. "Even if we don't end up closing the deal, this is going to take [PeopleSoft] time to recover."

That missive and other e-mails were released after Oracle urged a judge to unseal the documents. In an Aug. 23 petition to the court, Oracle argued that PeopleSoft was trying to make it seem as if Oracle had something to hide by keeping the e-mails sealed.

Describing the censored passages as "mundane" and "immaterial," Oracle's attorneys advised the judge to unseal the records because they "are typical of the types of communications that arise in every legal dispute between large corporate competitors."

For its part, PeopleSoft last Friday asked the judge to force Oracle to release even more of its internal e-mails to the press.

Signaling its determination to buy PeopleSoft, Oracle plans to hold its second online "town hall" meeting Wednesday to woo PeopleSoft's customers, many of whom have rallied against the bid.

Oracle's offer of $19.50 a share is set to expire Sept. 19, but the company already has indicated that it would extend the bid.

PeopleSoft is trying to convince everyone that Oracle's bid is dead and shift the focus instead on the company's own takeover -- a $1.8-billion acquisition of J.D. Edwards & Co. That deal has enabled PeopleSoft to leapfrog Oracle in the $20-billion market for business applications software and become the No. 2 provider behind Germany's SAP.

PeopleSoft executives are expected to paint a rosy picture of the J.D. Edwards combination Thursday when they meet with industry analysts in New York. It will mark the first time that PeopleSoft has provided a detailed look at its merger plans.

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