PeopleSoft`s share lost $0.19 on Nasdaq yesterday, with investors betting that rival Oracle`s takeover bid won`t happen after lawyers within the justice department`s anti-trust division recommended against the move.
Last week Oracle sweetened its offer for PeopleSoft to $26 a share, which the PeopleSoft board has subsequently rejected.
PeopleSoft issued a news release yesterday saying it had been informed by the justice department that lawyers within the anti-trust division had recommended that the department file suit to block Oracle`s proposed acquisition of PeopleSoft.
It said that the recommendation had been submitted to the office of the assistant attorney-general.
However, the recommendation is not a binding one. The final verdict on whether to file a suit against the proposed acquisition lies with assistant attorney-general Hewitt Pate, who is expected to make a decision next month.
That notwithstanding, Oracle has expressed confidence that the recommendation will not be enforced.
"While no decision has yet been made, Oracle believes this merger will eventually be approved," it says in an official statement.
Should Pate decide to file suit against the takeover, Oracle would have the option to fight the matter in court.
Oracle`s share closed at $13.72, up 2.32% from the previous close of $13.39, while PeopleSoft`s share closed $21.50, down 0.88% from the previous close of $21.69.
An earlier version of this report contained a typographical error which implied that Oracle believed the recommendation would succeed. The corrected version is above.
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