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PeopleSoft Starts Proxy Campaign to Defeat Hostile Bid by Oracle

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From Bloomberg News

PeopleSoft Inc., fighting a hostile bid by Oracle Corp., derided a slate of candidates for its board being promoted by Oracle and formally began a proxy campaign to defeat the nominations and the $26-per-share offer.

“Those nominees were chosen by the very same people who told you that Oracle’s previous $16 and $19.50 per share offers were ‘full and fair,’ ” PeopleSoft Chief Executive Craig Conway wrote in a letter to shareholders filed with the Securities and Exchange Commission.

Conway and Oracle CEO Larry Ellison are vying for votes ahead of a March 25 meeting where shareholders of Pleasanton, Calif.-based PeopleSoft will decide on the directors. Ellison has boosted his offer twice, and Conway and the current board continued to oppose the bid by saying it’s too low and probably would be rejected by antitrust regulators.

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Oracle Chairman Jeff Henley and Co-Presidents Safra Catz and Chuck Phillips met last week with Institutional Shareholder Services, the No. 1 proxy advisor to fund managers, seeking a recommendation to support the deal.

Shareholder Services said it would meet with PeopleSoft this week.

PeopleSoft shares fell 60 cents to $21.60 on Nasdaq. Oracle dropped 37 cents to $13.34.

Ellison nominated his slate when the offer still was $19.50 a share, meaning his candidates would have supported a buyout at that price, Conway said in his letter.

“Oracle now says you should trust Oracle’s nominees to look out for your interests,” Conway wrote.

“Would Oracle’s nominees have dismantled PeopleSoft’s defenses and allowed the company to be acquired at $19.50 per share?”

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