Timeline

It all kicked off on 6 June 2003, when Oracle ambushed PeopleSoft with a hostile

takeover bid. The $5.1bn offer came just days after PeopleSoft agreed a $1.7bn deal
with JD Edwards.

By 18 June, Oracle had upped this to $19.50 per share. PeopleSoft responded by
sweetening its all-share deal with JD Edwards to include cash, in the hopes of
closing more quickly. Along with JD Edwards, the company began legal action
against Oracle, alleging Ellison and co. were deliberately disrupting the merger.

As part of its defence against being acquired, PeopleSoft pledged to give its
customers between two to five times their license fees back, following a takeover.
Things started looking even better for Conway when, as June came to an end, the
US Department of Justice (DoJ) started an investigation to determine whether Oracle
should be allowed to buy PeopleSoft.

On 18 July, PeopleSoft and JD Edwards completed their merger. By November,

however, Oracle had gone on the offensive again. It initiated legal action in Delaware
to get the so-called poison pill removed.

Antitrust
The antitrust case pitted Oracle against the DoJ. The Department finally filed a
suit to block the deal (by this time worth a cool $9.4bn) in February 2004. It
described the deal as "anti competitive, pure and simple". The European
Commission agreed, and made its objections known in March 2004.

In April 2004, PeopleSoft reported lower than expected results, and by mid-May
Oracle had dropped its offer from a high of $26 to $21 per share. PeopleSoft still
wasn't interested.

Microsoft unexpectedly came to Larry Ellison's aid, when it emerged that the
company had been seriously considering an acquisition of SAP. Oracle said this
proved it was going to face tougher competition in the future, and that it should
therefore be allowed to buy PeopleSoft. In his evidence, Ellison said that if the
acquisition was blocked, it would have been a waste of a "tremendous amount of
time and energy".

As the trial rumbled on, PeopleSoft announced another poor quarter on 7 July. It laid
the blame for its falling sales squarely with Oracle.

Six weeks after hearing closing arguments in the antitrust trial, on 10 September,
Judge Vaughn Walker handed Oracle a stunning victory. He ruled that the merger of
Oracle and PeopleSoft would not be anti-competitive. PeopleSoft responded by
giving its staff bigger and better severance packages, making itself an even more
expensive proposition.

Europe says OK
In late September, rumours begin to circulate that the Eurocrats was preparing to
green-light the merger. The Financial Times reported that competition commissioner
Mario Monti would give the deal the go-ahead, before stepping down from his role.

Then, on 1 October, in a move that surprised everyone, the PeopleSoft board fired

Conway. It has lost confidence in his leadership. The board later claimed Conway
had misled analysts about the impact Oracle's bid would have on PeopleSoft's
performance.

This effectively sounded the death knell for PeopleSoft's battle to remain un-Oracled,
and any remaining doubters were silenced when, on 26 October, Commissioner
Monti officially approved the merger.

However, PeopleSoft founder Dave Duffield proved no pushover. Despite a majority

of shareholders voicing support for the offer, he rejected Oracle's "best and final" bid
of $24 per share, saying it undervalued the company.

On the steps of the courthouse

On 25 November, Judge Leo Strine of the Delaware court said he needed to hear
more evidence before ruling on the poison pills, specifically why PeopleSoft's board
turned down the offer of $24 per share. He said the hearing would take place on 13
or 14 December. Meanwhile, Oracle maintained the legal pressure on its prey to
drop the poison pills it had installed. It also pledged to "oversupport" PeopleSoft's
customer base, dismissing suggestions that it would drop JD Edwards product lines.
It promised to provide full support for PeopleSoft products until 2013.

But as the day of the new hearing dawned, the companies announced that they had
come to terms, and the deal was done. Oracle eventually agreed to pay $26.50 per
share for PeopleSoft. This values PeopleSoft at about $10.3bn: a ten per cent
premium on the company's closing value.

In a statement issued this morning, the appropriately named PeopleSoft chairman,

George Battle, described the fight for his company as "long and emotional". He said:
"After careful consideration, we believe this revised offer provides good value for
PeopleSoft stockholders and represents a substantial increase in value from
October."

Both lawsuits have been suspended, and will be dropped when the merger is
finalised, the companies said. Ellison said he expected the deal to close in January,
adding that it would add about one cent per share to Oracle's Q4 results, and around
two cents per quarter in its 2006 financial year.

Source- The Register, UK