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Monday, September 12, 2005

Oracle Acquisition of Siebel

Just before Oracle OpenWorld, this deal was announced.

Oracle Agrees to Buy Siebel for $10.66 a Share
Vaults Oracle to Number 1 in Customer Relationship Management

REDWOOD SHORES, Calif., 12-SEP-2005 Oracle Corporation (Nasdaq: ORCL) announced today that it agreed to buy Siebel Systems, Inc (Nasdaq: SEBL) for $10.66 per share. The offer is valued at approximately $5.85 billion, or $3.61 billion net of Siebel's cash on hand of $2.24 billion.

"In a single step, Oracle becomes the number one CRM applications company in the world," said CEO Larry Ellison. "Siebel's 4,000 applications customers and 3,400,000 CRM users strengthen our number one position in applications in North America and move us closer to the number one position in applications globally."

"Today is a great day for Siebel Systems' customers, partners, shareholders, and employees," said Thomas M. Siebel, Chairman of Siebel Systems. "The combination of Siebel applications with the development capacity of Oracle to enhance our CRM product set assures our customers continuing success. This is a very beneficial business combination that will allow us to be even more effective in delivering high quality, leading edge solutions into the hands of satisfied customers."...

CRM applications capture and streamline all customer interactions so CRM users can better understand, service and anticipate their own customers' needs. Of all major segments of the enterprise applications business, CRM is the largest and fastest growing - estimated to be more than $8 billion in 2004 and expected to grow to $10 billion by 2009, according to IDC. Siebel's CRM and Oracle's enterprise applications and middleware share an architecture that embraces industry standards, and a significant majority of Siebel's implementations run on the Oracle database.

The Board of Directors of Siebel Systems has voted in favor of the transaction, and Tom Siebel has agreed to vote his shares in favor of the acquisition. Siebel stockholders will convene in a special meeting to vote on the acquisition. Oracle stockholder approval is not required. While the transaction and the timing are subject to regulatory approvals, the deal is expected to close in early 2006....

Oracle will host a conference call today, Monday, September 12, at 5:30 a.m. PDT/8:30 a.m. EDT to discuss the acquisition. A live audio webcast of the call will be made available on the Oracle Investor Relations website at www.oracle.com/investor. Interested parties may participate live via telephone by calling (888) 791-1856 (domestic) or (630) 395-0019 (international), passcode: Oracle. The webcast will be available for replay for seven days following the conference call. The replay number is (866) 357-4207 (domestic) or (203) 369-0123 (international), passcode: 6524....


Reaction from Dot Net Matters (and CRN?):

The news came like an ocean liner out of the fog: Oracle will buy apps rival Siebel Systems.

And with that on Monday morning, Oracle CEO Larry Ellison completely pre-empted Microsoft's semi-annual PDC developers show and any news that might be forthcoming.

The timing was clearly not fortuitous. A traditional (boring) company might have waited for its big users show--Oracle OpenWorld is next week. But noooooo Ellison dropped the bomb just as PDC is gearing up in L.A.

Super genius.

Not that this deal hadn't been bandied about for years, it's just that you had to wonder how far even Ellison was willing to go in pursuit of unseating SAP as biz apps kingpin. (Oh and stick it to Microsoft).

The answer is, pretty damn far. After writing a check for more than $10 billion big ones for PeopleSoft (and J.D. Edwards), and spending comparative petty cash on TimesTen, Oblix, parts of Context Media etc., Larry and the gang have gone for the gusto in Siebel Systems and its CRM expertise. Oh yeah, and Seibel's two-plus billion in cash.

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