Oracle Corporation is one of the largest enterprise software companies. They develop,
manufacture, market, distribute and service database software, middleware software, and
applications software. Oracle has been incorporated since the mid 80’s, and had risen to be
a market forerunner for their industry in that time (Oracle, 2005). Oracle has been able to
do that through, among other things such as strong product offerings, to aggressive
business tactics. In Oracle Corporation CEO Larry Ellison has even been quoted saying,
“We think hostile takeovers do work. We think the engineering team is not going to pick
up and leave” (Bank, 2004).
Ellison and Oracle demonstrated this with their hostile takeover of their top industry
competitor PeopleSoft. At the end of 2004, Oracle Corporation acquired rival enterprise
software company PeopleSoft for $10.3 billion (Aranda & Breslin, 2014). Oracle had a
strong database product that helped them achieve a lot of their success, but they were
lagging behind on a growing new trend of application software, a trend that PeopleSoft had
already been integrating and implementing successfully.
So Oracle’s decision to acquire PeopleSoft stemmed from several intentions, but it can be
garnered that the primary motivation for it was to increase their market share. After the
merger, that left only two primary suppliers of business software products. That would be
German-based company SAP AG and Oracle Corporation. So Oracle Corporation was able
to assume PeopleSoft’s market share, which had been increasing to the point of acquisition
Oracle had been bidding to acquire PeopleSoft since June 2003 so it took 18 months with
repeated offers from Oracle to complete the deal. The initial June 03 offer was for $16 a
share which would have come to about a $5.1 billion acquisition. This offer was rejected
by PeopleSoft’s board, and five more offers were made in those subsequent 18 months. A
reported high offer before the final offer was for $26 a share, but that was also rejected.
Oracle actually decreased the bid after, and stated a “best and final” offer for $24 a share
before new evidence convinced an offer for $26.50/share which the PeopleSoft board
agreed to (La Monica, 2004).
Oracle’s initial plan with the acquisition was to completely eliminate selling any further
PeopleSoft products and services. Ellison was reported to have claimed PeopleSoft’s
customer list was a major reason for their pursuit of the company (Bank, 2004). This
seems to support Oracle’s intention just to improve their own market share by acquiring
