Sun Microsystems Acquired By Oracle For $7.4B
Announced this morning, the "definitive agreement" will see Oracle acquire all of Sun's common stock for $9.50 per share in cash, which amounts to a breathtaking $7.4 billion -- or $5.6 billion net of Sun's cash and debt. Oracle President Safra Catz had this to say about the newly struck deal: "We expect this acquisition to be accretive to Oracle's earnings by at least 15 cents on a non-GAAP basis in the first full year after closing. We estimate that the acquired business will contribute over $1.5 billion to Oracle's non-GAAP operating profit in the first year, increasing to over $2 billion in the second year. This would make the Sun acquisition more profitable in per share contribution in the first year than we had planned for the acquisitions of BEA, PeopleSoft and Siebel combined."
Obviously, Oracle is pretty high on the whole ordeal, with CEO Larry Ellison asserting that his company will soon be "the only company that can engineer an integrated system - applications to disk - where all the pieces fit and work together so customers do not have to do it themselves." Oracle's playing up the acquisition of Sun's own Java and Solaris, noting that the two will be able to "drive the innovation pipeline to create compelling value to its customer base and the marketplace."
The Board of Directors of Sun Microsystems has unanimously approved the transaction. It is anticipated to close this summer, subject to Sun stockholder approval, certain regulatory approvals and customary closing conditions.