PeopleSoft Inc.'s board of directors has unanimously voted to recommend that shareholders reject Oracle Corp.'s revised takeover offer of $6.3 billion, or $19.50 per share.
In a statement released this morning, PeopleSoft said the deal undervalues the company based on its current financial performance and its prospects for growth if it succeeds in merging with Denver-based rival J.D. Edwards.
Oracle first launched a hostile takeover bid on June 6, presenting PeopleSoft shareholders with a $5.1 billion offer. It upped the ante Wednesday morning in a move seen by some as a sign that Oracle was serious about acquiring PeopleSoft. Oracle's bid has clouded PeopleSoft's planned merger with J.D. Edwards, announced June 2.
"PeopleSoft is committed to the J.D. Edwards acquisition," PeopleSoft CEO Craig Conway said in a statement. "We believe that the continued execution of our strategy will create significantly higher stockholder value."
The PeopleSoft board's decision was based on the recommendation of a committee of independent directors evaluating the Oracle offer, the statement said. As it did when rejecting Oracle's initial offer, the board said this new deal would be subject to regulatory delays and the "significant likelihood that the transaction would be prohibited."
The board also said the offer was risky because it is "highly conditional and Oracle could withdraw it at any time."