Ellison talks acquisitions, mocks PeopleSoft’s Conway

Oracle Corp. executives repeated on Wednesday that more takeovers could follow the company’s bid for PeopleSoft Inc. At the same time, mudslinging between Oracle and PeopleSoft continued, even though Oracle described itself as a “generally friendly” company.

“We’d be interested in buying almost anything,” Oracle Chairman and Chief Executive Officer Larry Ellison said at a meeting with financial analysts at his company’s Redwood Shores, Calif., headquarters.

That is if the price is right, and “almost anything” does have its exclusions, Ellison said. Oracle won’t buy Ariba Inc. or CommerceOne Inc., vendors of online marketplaces. Also, Oracle looked at buying Legato Systems Inc., but didn’t because it felt it could not win from Veritas Software Corp. in storage management software space, he said.

Data storage vendor EMC Corp. on Tuesday announced a deal to buy Legato in a stock transaction valued at US$1.3 billion.

Clues on where Oracle could strike came from Executive Vice-Presidents Safra Catz and Chuck Phillips, who spoke to the analysts just before Ellison. Phillips two weeks ago hinted that Oracle may do some more shopping.

On the database side of its business, Oracle is interested in technologies that will help users reduce cost and fit with its strategy of getting more information into a database, while on the applications side Oracle wants to move further into verticals such as health care and retail, said Catz.

Also, there are new markets that Oracle would like to get into, said Phillips, without providing any more detail. Phillips was recruited to Oracle recently after years on Wall Street as an analyst covering enterprise software and is one of the main forces behind Oracle’s bid for PeopleSoft.

“We generate a tremendous amount of cash and we have been using that cash to buy back our stock. We could have been using that money for acquisitions,” said Ellison.

Oracle prefers friendly acquisitions whereby the takeover target agrees to be bought, instead of a prey resisting to be devoured, said Catz. “Our preference is to do something friendly, but friendliness was not going to be a possibility here. Out hopes are that all our deals are friendly,” she said. Added Phillips: “We are generally friendly people.”

Ellison vowed to continue to pursue PeopleSoft, even if it takes a year to get the deal done, and said that the Pleasanton, Calif., vendor could not survive on its own in a consolidating enterprise software market.

“It is going to get very, very tough out there and they are just not big enough company, a strong enough company to be competitive,” he said.

Oracle launched a US$5.1 billion hostile takeover bid for PeopleSoft in early June, days after PeopleSoft said it would buy J.D. Edwards & Co. Oracle later sweetened its bid to US$6.3 billion.

Fielding questions from the financial analysts, Ellison, Phillips and Catz, mostly repeated the arguments Oracle has made in favour of the PeopleSoft bid. Ellison came out strongly once more against PeopleSoft CEO Craig Conway’s defensive reaction to the bid.

“At one point Craigy (Conway) thought I was going to shoot his dog,” Ellison said. “I love animals. If Craigy and (his dog) were standing next to each other and, trust me, I had one bullet it wouldn’t be for the dog.”

Ellison’s comment was apparently related to quotes attributed to Conway shortly after Oracle launched its bid for PeopleSoft. “It’s like me asking if I could buy your dog so I can go out back and shoot it,” Conway was quoted as saying.

Besides the CEOs battling each other in the press, the companies are also fighting in courts and advertisements.

Oracle has said it would not actively market PeopleSoft products after successfully acquiring the company, but that it would support the applications. PeopleSoft sees an acquisition by Oracle as the end of its products and fiercely opposes Oracle’s bid.

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Jim Love, Chief Content Officer, IT World Canada

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