PeopleSoft Inc.'s board of directors voted unanimously to recommend shareholders reject Oracle Corp.'s unsolicited US$5.1 billion bid to take over the company. Oracle's announced plans to discontinue development of PeopleSoft products would limit choice and stifle competition, harming both PeopleSoft's customers and its stockholders, PeopleSoft Chief Executive Officer (CEO) Craig Conway said in a statement.
Echoing comments made earlier this week by J.D. Edwards & Co. CEO Bob Dutkowsky, PeopleSoft warned that Oracle's plan raises significant antitrust issues and stands a strong chance of being rejected by government regulators in the U.S. or Europe.
PeopleSoft's board cited Oracle's low valuation of PeopleSoft as another factor in its rejection. Oracle's tender offer, which commenced Monday and runs through July 7, offers $16 for each tendered PeopleSoft share. Since Oracle announced its bid on Friday, PeopleSoft (PSFT) shares have continuously traded above $16. In Thursday morning trading on the Nasdaq exchange, shares were at $17.69.
PeopleSoft's board also reiterated its endorsement of the Pleasanton, California-based company's plans to acquire J.D. Edwards, in Denver. PeopleSoft filed Wednesday regulatory paperwork related to the buyout with several U.S. agencies.
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