The consummation of PeopleSoft`s purchase of JD Edwards would not mean the end of Oracle`s bid to acquire PeopleSoft, says research firm Gartner.
The takeover tangle began on 2 June when PeopleSoft announced an agreement to buy JD Edwards for $1.7 billion, creating the second-largest enterprise application software vendor after SAP.
Four days later Oracle made an offer to buy PeopleSoft for $5.1 billion, raising its offer on 18 June to $19.50 a share or $6.3 billion.
PeopleSoft, whose tender offer for JD Edwards closes at midnight tonight, New York time, says JD Edwards shareholders will receive the value of $14.7384 in cash, stock or a combination of each for every JD Edwards share tendered.
This places a total value of $1.8 billion on the deal.
Earlier this week Oracle extended its own offer to buy PeopleSoft. The offer`s close, already extended previously to tomorrow, has now been scheduled for 15 August, although Oracle`s offer price has remained at $19.50 a share.
Gartner says that if JD Edwards shareholders tender less than 50.1% of stock to PeopleSoft, the PeopleSoft offer for JD Edwards will be extended. If at least 50.1% is tendered, the acquisition will take place within 20 business days, but if 90% of stock is tendered the acquisition could be completed immediately.
However, it points out that if the PeopleSoft purchase of JD Edwards is consummated, it does not mean the end of Oracle`s bid.
"Oracle`s extension of the deadline further illustrates that the uncertainty will continue. However, the acquisition of JD Edwards will give PeopleSoft a potentially higher long-term market valuation and make it a potentially more expensive acquisition target."
Reuters reports that analysts believe Oracle would face renewed pressure to raise its offer for the combined companies.
Oracle says it is unswayed by the news, and has been mum on whether completion of the JD Edwards acquisition would prompt it to raise its offer.
"We remain fully committed to acquiring PeopleSoft, with or without JD Edwards," says spokesman Jim Finn.
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