More than 60 percent of PeopleSoft Inc's shareholders have tendered their stock in support of Oracle Corp's US$9.2 billion takeover bid for its bitter rival, further extending a battle that already has dragged on for more than 17 months.
As of late Friday, Oracle said 228.7 million PeopleSoft shares had been tendered, giving the Redwood Shores-based company the majority support that it demanded to keep its US$24-per-share offer alive.
"The owners of PeopleSoft have spoken and have overwhelmingly chosen to sell to Oracle at US$24 per share," said Oracle CEO Larry Ellison. "We are prepared to enter a definitive merger agreement as early as this weekend."
Oracle sent a letter to PeopleSoft's board requesting a meeting as soon as possible and extended its offer until Dec. 31. The company planned to withdraw the offer if most PeopleSoft shareholders hadn't tendered their stock by midnight Friday.
PeopleSoft declined comment after the vote was announced, but the company's board previously has vowed to continue its resistance through the winter.
Maintaining that Oracle's current bid is inadequate, PeopleSoft's board has advised shareholders not to tender their stock.
If Oracle had abandoned its proposed combination of business software makers, industry analysts believe PeopleSoft's stock would have plunged by more than 30 percent as shareholders hoping to cash in on a takeover dumped their stakes.
With that prospect looming, more shareholders concluded it made sense to tender their stock to keep Oracle's offer on the table while PeopleSoft's management tries to deliver on its rosy sales forecasts next year, American Technology Research analyst Donovan Gow said.
If PeopleSoft delivers, the company's stock could rise above US$24 per share, but Oracle's bid provides a safety net if sales should falter.
"I think we are going to be talking about this [takeover attempt] for many more months to come," Gow said.
In anticipation of the saga continuing, PeopleSoft's shares gained US$0.25 on Friday to close at US$23.17 on the NASDAQ Stock Market, where Oracle's shares declined US$0.22 to US$12.75.
Oracle's pursuit of its Pleasan-ton-based rival quickly evolved into a Silicon Valley soap opera featuring venomous personal attacks, courtroom drama and even the firing of a chief executive -- PeopleSoft's former leader, Craig Conway. Along the way, Oracle and PeopleSoft have combined to spend US$169 million fighting each other so far and hurt both companies' sales in the process as the uncertainty caused more corporate customers to buy business applications software from industry leader SAP.