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Oracle Buys Sun for $7.4 Billion

By - Source: Tom's Hardware US | B 35 comments

Hold everything, Oracle has agreed to buy Sun.

At the end of last week, Bloomberg reported that struggling Sun Microsystems had returned to rebuild previously burned bridges with IBM. According to Bloomberg, Sun said it would talk if IBM made a stronger commitment to buy. It reeked of desperation, but then who was going to argue that at this stage in the game Sun wasn’t getting a little bit anxious to sell?

Following the collapse of the IBM deal, the outlook for Sun wasn’t exactly bright. While many felt the $9.50 per share initially offered by IBM was more than Sun was worth, analysts debated as to whether or not a single company would be willing to buy Sun in its entirety and feared that the best option may be for Sun to break into smaller divisions and sell individually.

Early this morning all that changed: Oracle announced that it will buy Sun for a reported $7.4 billion, or $9.50 per share. According to the New York Times, the two companies said in a statement that the value of the transaction would be $5.6 billion net of Sun’s cash and debt. According to Bloomberg, Oracle President Safra Catz has said Sun will contribute an estimated $1.5 billion to the company’s non-GAAP operating profit in the first year, with that figure increasing to over $2 billion by year two.

“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,” Catz continued. Oracle has also dubbed Java “the most important software” it has ever acquired.

Reuters reports that Sun shares this morning jumped 27.1 percent (up to $8.50 from $6.69 on Friday) and Oracle shares fell 4.2 percent (down to $18.25).

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  • 1 Hide
    LuxZg , April 20, 2009 1:20 PM
    Sooo... they've sold it to Oracle for the same price that IBM was offering. Weird.. I mean, if I was Sun I'd rather sell to IBM, after all they have far more in common than Sun and Oracle. I'm guessing a big part of Sun will just get thrown out in garbage once restructuring is finished, which wouldn't happen with IBM.

    Ofcourse, I'm no analyst of any kind, just IMHO..
  • 1 Hide
    LuxZg , April 20, 2009 1:23 PM
    Oh, and a link missing under sources:
    http://www.oracle.com/us/corporate/press/018363
    (from http://www.oracle.com/us/corporate/press/index.htm )

    I would thought this one is most important, as it's official after all :) 
  • 1 Hide
    JMcEntegart , April 20, 2009 1:30 PM
    LuxZgOh, and a link missing under sources:http://www.oracle.com/us/corporate/press/018363(from http://www.oracle.com/us/corporate/press/index.htm )I would thought this one is most important, as it's official after all


    A thousand thank yous. I'll add them in now. :) 
  • 0 Hide
    neiroatopelcc , April 20, 2009 1:53 PM
    sun being sold to oracle? that might be good news! perhaps in a year or so we'll have a version of java that actually works as documented! oracles databases rarely misbehave after all ... and java always does ...
  • 3 Hide
    kyeana , April 20, 2009 2:10 PM
    ^i think you got the wrong thread :p 
  • 0 Hide
    tenor77 , April 20, 2009 2:16 PM
    Maybe they could invest some money into making their database a little more stable. I swear mines down once a week.
  • 3 Hide
    smk4664 , April 20, 2009 2:27 PM
    What does this mean for MySQL? With Oracle having it's own database, would this not be a conflict of interest? Would we have to start paying for licenses?
  • 0 Hide
    7amood , April 20, 2009 2:29 PM
    Oracle excels in DBMS but I was suffering when I used the Oracle development forum... it was so frustrating to use and it was so outdated. It was like a project made by some student and totally messed up.

    I hope that they will enhance Java before using it for any reason. I hope that they will deliver a USABLE product that is USER-FRIENDLY and does what it supposed to do in terms of functionality.
  • 9 Hide
    fonzy , April 20, 2009 2:29 PM
    Is there anyway to disable that fucking Dell ad that pops up every time I visit this site.
  • -1 Hide
    neiroatopelcc , April 20, 2009 2:32 PM
    fonzyIs there anyway to disable that fucking Dell ad that pops up every time I visit this site.

    use kaspersky's anti banner feature - or download one of the many rigged lists for your hosts file to redirect the ad sites to localhost

    smk4664What does this mean for MySQL? With Oracle having it's own database, would this not be a conflict of interest? Would we have to start paying for licenses?

    I don't know the answer to that, but it got me thinking. Our management told us in december, that from this year we're going to use openoffice on the ~2000 pcs we have for customers.... openoffice is sun right? I wonder if that's still going to be free then?
  • 1 Hide
    megamanx00 , April 20, 2009 2:38 PM
    WTF? Welp, with MySQL as their biggest competitor in databases it's not a bad move for them. They paid too much though ^_^. This way they can control MySQL, heck maybee they will even tone down the paid support so they can say "If you want a real database with real support you need to upgrade from MySQL. Look we're running a special on it!".
  • 2 Hide
    squatchman , April 20, 2009 2:40 PM
    Openoffice is sponsored by Sun and Sun then ... ahh... repackages(?) it as Star Office for Solaris. The project may have to find a new sponsor. If MySQL wasn't already dead in the water, then I think this may be the straw that breaks the camel's back.
  • 2 Hide
    smk4664 , April 20, 2009 2:44 PM
    neiroatopelccI don't know the answer to that, but it got me thinking. Our management told us in december, that from this year we're going to use openoffice on the ~2000 pcs we have for customers.... openoffice is sun right? I wonder if that's still going to be free then?

    Yes, Open Office is Sun. Along with Virtual Box, and a few other Open Source software. I don't really know what Oracle's track record with Open Source is, but this could present a problem for the linux community.
  • -3 Hide
    neiroatopelcc , April 20, 2009 2:48 PM
    squatchmanOpenoffice is sponsored by Sun and Sun then ... ahh... repackages(?) it as Star Office for Solaris. The project may have to find a new sponsor. If MySQL wasn't already dead in the water, then I think this may be the straw that breaks the camel's back.

    Okay - so if you're right, I don't have to worry having to remove it in 6 months again.

    smk4664Yes, Open Office is Sun. Along with Virtual Box, and a few other Open Source software. I don't really know what Oracle's track record with Open Source is, but this could present a problem for the linux community.

    Oracle is one of the creators of realvnc - so they do know what opensource is - in general I don't like opensource though. I prefer software where someone claims responsibility when there's a problem.
  • 0 Hide
    powerbaselx , April 20, 2009 2:57 PM
    Will Oracle sell parts of Sun to HP as many news stated before? Or will Oracle keep the Hardware business divisions?

    IMO IBM didn't really have the need to buy Sun to improve its business. I see it just an opportunity for IBM to remove a smaller competitor from market.

    Another player which has been silent is Microsoft. Maybe it's waiting to buy HP one day... :-)

  • 0 Hide
    solymnar , April 20, 2009 2:57 PM
    The "open source" side of things will be completely up in the air until oracle makes official comment. And that comment could slice either direction.

    In terms of what it could mean for their database...this could be a very very good match. Java makes great GUI front ends, esp considering it can load and run the same way regardless of OS. Building this into their software to make it a more complete and flexible package in terms of customizing end user interfaces would be a handy thing I'd imagine.
  • 0 Hide
    deck , April 20, 2009 3:01 PM
    Oracle is positioning themselves nicely to be able to provide an end-to-end server side Web Application environment. Java + WebLogic + Oracle = Dominant
  • 0 Hide
    superblahman123 , April 20, 2009 3:11 PM
    If Oracle plays their cards right with this move, then they could potentially be one of the strongest players out here. Oracle has such a high potential of growth now that they have control of MySQL. Despite Oracle being ok with open source, they're not going to let MySQL go on like it has. Hell, if I were them, I'd can MySQL all together.
  • -1 Hide
    tayb , April 20, 2009 3:59 PM
    I am guessing this will be the end of the line for Open Office.
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