The Wall Street Journal and New York Times report that according to people familiar with the matter, software giant Oracle Corp., the worlds #2 maker of business software for areas like finance and human resources, will buy Hyperion Solutions Corp. for $52 cash a share, or about $3.3 billion -- a 21% premium over Hyperion's $42.84 close yesterday. The acquisition will be announced today, they said. Hyperion competes in the business-intelligence market, making software that helps companies collect, analyze and share performance data. The people said Oracle hopes the acquisition will help it lure customers from rival SAP (who leads Oracle in market share), many of whose customers also use Hyperion products. The deal would be the latest in a two-year acquisition spree in which CEO Larry Ellison has spent over $20 billion in buying more than 25 software companies, including two of its biggest competitors, PeopleSoft in Dec. 2004 for $10.3 billion and Siebel Systems last year for $5.9b. Oracle posted strong FQ2 earnings growth in December, but its license sales rose only 28%, down from 80% in the previous quarter.
Sources: Wall Street Journal, New York Times
Commentary: Oracle At it Again? Rumors of a Hyperion Buyout • Oracle Trading at “Undeserved Discount” • Hyperion Wows The Analysts
Stocks/ETFs to watch: Oracle Corp. (NYSE:ORCL), Hyperion Solutions Corp. (HYSL). Competitors: SAP AG (NYSE:SAP), Microsoft Corp. (NASDAQ:MSFT), Computer Associates International Inc. (NASDAQ:CA), Business Objects S.A. (BOBJ), Cognos Inc. (COGN), International Business Machines Corp. (NYSE:IBM). ETFs: iShares Goldman Sachs Software Index Fund (NYSEARCA:IGV), Software HOLDRS Trust ETF (NYSE:SWH), PowerShares Dynamic Software (NYSEARCA:PSJ)
Conference call transcripts: Oracle F2Q07 • Hyperion Solutions F1Q07
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