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Little Drama at PeopleSoft

Shareholder summit does not provide a fight over Oracle's bid but shows why the two companies haven't hit it off

March 26, 2004|Joseph Menn | Times Staff Writer

PLEASANTON, Calif. — PeopleSoft Inc.'s annual meeting Thursday, once anticipated as the decisive slugfest over Oracle Corp.'s hostile tender offer for the business software firm, came off with all the ferocity of afternoon tea at a retirement home.

Oracle had nominated a slate of directors for the PeopleSoft board in hopes that they would revoke the company's anti-takeover defenses and clear the way for the $9.4-billion acquisition. After the Justice Department sued last month to block the bid, the database powerhouse withdrew its nominees to focus on the legal battle.

Although the gathering didn't feature a dramatic showdown over the future of the company, it still provided a quiet lesson on why Oracle and PeopleSoft haven't exactly hit it off.

Of the three -- count 'em, three -- audience members who rose to speak in the time allotted for general comments, only one asked why PeopleSoft's board wasn't more receptive to a tender offer that would give investors an immediate 40% return on their holdings.

And the four PeopleSoft directors who were running for reelection garnered at least 95% of the shares cast despite the recommendation of proxy advisor Glass, Lewis & Co. that investors withhold votes from three of them.

PeopleSoft shareholder Shirley Anderson, a 75-year-old school district retiree, was typical of the 100 or so attendees, many of whom reside near the company's Pleasanton headquarters.

"I feel the company's very well managed," Anderson said. "I'm totally opposed to Oracle taking over."

The hometown feel of the assembly, held across from a modest shopping mall 30 miles east of San Francisco, was in marked contrast to Redwood City, Calif.-based Oracle's high-energy meetings for investors and analysts in Silicon Valley. And although Oracle Chief Executive Larry Ellison has used those summits to cheerfully predict the death of his competitors, PeopleSoft's chief financial officer proudly told the shareholders on hand that their company was No. 2 in some of its markets.

The only rebuke to PeopleSoft's board came with the narrow approval of a proposal urging the firm to record stock option grants as an expense.

The meeting was over in less than an hour and provided so little drama that CEO Craig Conway nearly apologized. PeopleSoft director George Battle acknowledged that the meeting had few of the fireworks many expected.

"My wife was going to come down here because she heard it was going to be really exciting," said Battle, who led the proceedings. "I'm going to have to tell her it wasn't."

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