Oracle back in the frame with PeopleSoft

Oracle is back in the running with its long running hostile bid for PeopleSoft, following defeat of the US Department of Justice in its anti-trust proceedings. On September 9, the US court ruled in favour of Oracle, giving the DOJ 60 days to appeal. Although there is still the possibility of opposition from the European Commission, that now looks less likely, and the likelihood of an Oracle takeover has now increased. But it’s by no means a done deal. Although Oracle has again extended its offer of $21 per PeopleSoft share, it still needs to convince PeopleSoft’s currently extremely reluctant board to abandon its ‘poison pill’ provision, not to mention institutional shareholders, and there is outstanding litigation between the two adversaries in the US. For existing and potential PeopleSoft Enterprise users, analysts suggest that, since Oracle has already committed to huge ongoing support, they should continue. The position for the former JD Edwards’ ERP systems is less clear, and their basis in IBM technology, as opposed to Oracle, makes them look less attractive and thus less likely to be given the same heroes’ welcome. Word on the street is that the former JDE business might be sold – potentially to the apparently ravenous SSA Global. Given PeopleSoft’s latest announcements, particularly around its Demand-Driven manufacturing initiative on EnterpriseOne v8.11, that outcome is less than obvious. Meanwhile, potential users, say analysts, might want to pause for thought. However, that message, it seems, is not being heeded, with PeopleSoft parading substantial net new customers in the last quarter alone – certainly outstripping its rival numerically and in terms of revenue. For the software industry, it’s again a worrying time. Takeover or no takeover, consolidation is rife, and with all eyes turning to the mid-market with its fragmented industries and software choices, only a brave or foolish person would want to predict who else will still be around in five years time.