SAN FRANCISCO -- Takeover-hungry Oracle Corp. has made it clear that it intends to acquire other companies no matter how its $7.7 billion bid for rival business software maker PeopleSoft turns out, but the selections on its menu had been a secret -- until now.
The Justice Department provided some insights into Oracle's thinking late Monday with the release of previously confidential documents that listed the company's potential targets as of April 2003. The government submitted the documents as evidence in an antitrust trial seeking to block Oracle's hostile bid for PeopleSoft.
Oracle's shopping list consisted of five business applications software makers and four other companies involved in other industry niches. The 48-page analysis included the pros and cons of pursuing a bid for each of the targeted companies.
Besides PeopleSoft, the other business applications software makers in Oracle's sights were Lawson Software Inc., Cerner Corp., SunGard SCT Inc., and J.D. Edwards & Co., which PeopleSoft bought for $2 billion last summer.
In a videotaped deposition shown late Monday, Oracle chief executive Larry Ellison also trumpeted another business applications software maker, Siebel Systems Inc., as an appealing target, suggesting it would rank as his third choice behind PeopleSoft and San Jose-based BEA Systems. Ellison made those remarks last month, nearly a year after Oracle began its pursuit of PeopleSoft.
While its PeopleSoft bid remains in legal limbo, Oracle has repeatedly said it's eager to make other deals. Just last week, Oracle chairman Jeff Henley told reporters the company hopes to pull off at least one or two multibillion-dollar acquisitions during the next year, even if its PeopleSoft bid collapses. Henley didn't identify potential targets.
The release of the shopping list overshadowed the testimony of California Institute of Technology business economics professor Preston McAfee. The antitrust specialist, hired by the Justice Department, estimated that major US companies shopping for sophisticated software to automate their accounting and personnel departments would face price increases of up to 30 percent if Oracle Corp. buys PeopleSoft.
After reviewing sales data that documented steep price discounting when Oracle and PeopleSoft face off in head-to-head competition, McAfee used complex economic models to calculate what might happen if the two rivals were no longer bidding against each other.