Oracle: No Truth to MySQL Report

Includes: JAVA, ORCL
by: The Deal Economy

We were all ready to launch a bit of self-righteous skepticism at a report in Friday's New York Post that said Oracle Corp. (NASDAQ:ORCL) was ready to kowtow to European regulators over its pending $7.2 billion acquisition of Sun Microsystems Inc. (NASDAQ:JAVA). Specifically, the Post, citing two unnamed sources, said that Oracle plans to hive off Sun's MySQL database unit, the acquisition of which the European Commission has objected to, as some sort of separate entity.

Oracle beat us to it, with a spokesperson telling Reuters that the Post report is "completely untrue." Despite the concerns voiced by the EC over combining MySQL with Oracle's leading database management software, we find it hard to believe that Oracle CEO Larry Ellison, who has in no uncertain terms said that his company will win unconditional approval for the Sun deal, would back down.

Despite the fact that some worry about MySQL's fate inside of Oracle, it seems unlikely that absorbing the unit will really stifle competition in the database management world (or at least, hurt it to a degree that warrants Brussels blocking the deal -- The Deal Pipeline subscribers can read more about that here).

The EC last month extended its review of the Oracle-Sun deal through Jan. 27 to give the buyer more time "to further develop its arguments in response to the Commission's concerns," the regulator said. We'll soon find out it Oracle's persuasiveness wins out again, as it has so often in the past. This time at least, unlike with its PeopleSoft acquisition back in 2004, Oracle has the U.S. Department of Justice on its side. - Olaf de Senerpont Domis