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Oracle Buys Sun for $7.4 Billion

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8:51 AM - April 20, 2009 by Jane McEntegart

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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Source : Tom's Hardware US

Talkback
Add your comment
LuxZg 04/20/2009 3:20 PM
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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..

LuxZg 04/20/2009 3:23 PM
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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 :)

JMcEntegart 04/20/2009 3:30 PM
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LuxZg :
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



A thousand thank yous. I'll add them in now. :)

neiroatopelcc 04/20/2009 3:53 PM
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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 ...

reddragon72 04/20/2009 4:02 PM
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kyeana 04/20/2009 4:10 PM
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^i think you got the wrong thread :P

tenor77 04/20/2009 4:16 PM
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Maybe they could invest some money into making their database a little more stable. I swear mines down once a week.

smk4664 04/20/2009 4:27 PM
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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?

7amood 04/20/2009 4:29 PM
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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.

fonzy 04/20/2009 4:29 PM
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Is there anyway to disable that fucking Dell ad that pops up every time I visit this site.

neiroatopelcc 04/20/2009 4:32 PM
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fonzy :
Is 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

smk4664 :
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?


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?

megamanx00 04/20/2009 4:38 PM
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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!".

squatchman 04/20/2009 4:40 PM
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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.

smk4664 04/20/2009 4:44 PM
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neiroatopelcc :
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?


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.

neiroatopelcc 04/20/2009 4:48 PM
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squatchman :
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.


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

smk4664 :
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.


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.

powerbaselx 04/20/2009 4:57 PM
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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... :-)

solymnar 04/20/2009 4:57 PM
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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.

deck 04/20/2009 5:01 PM
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Oracle is positioning themselves nicely to be able to provide an end-to-end server side Web Application environment. Java + WebLogic + Oracle = Dominant

superblahman123 04/20/2009 5:11 PM
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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.

tayb 04/20/2009 5:59 PM
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I am guessing this will be the end of the line for Open Office.

jsloan 04/20/2009 6:06 PM
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crap this is terrible news. ibm would have been better for java. i guess oracle has been of late buying has beens and losers, like bea... focus on large companies, large business solutions and services.

gsacks 04/20/2009 6:17 PM
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tayb :
I am guessing this will be the end of the line for Open Office.



Illustrating a fundamental lack of understanding of open source. Yes, Open Office will need to find another corporate sponsor if Oracle does not continue to fund its development should this deal go through.

Since Oracle currently markets DBMS software systems including RHEL OS with one-stop full service contracts for both the DB and OS, they DO have a vested interest in open source, though not so much on the desktop at this point. I suspect this means will now be able to take that same product and include the hardware.

Blessedman 04/20/2009 6:40 PM
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I am just glad to see Oracle spend some of the mounds of cash they have been hording.

SAL-e 04/20/2009 8:13 PM
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Oracle is developing the new BRFS file system for Linux. I don't think we should worry too much about the impact on OSS and Linux in general. There will be some changes for sure. I think OO will move to Ubuntu and Novell and we can see some good changes there. I hope that Oracle combines the strong features from MySQL and Oracle DB and produce superior DB framework. If I am MS I would worry about the future of the MS SQL.

zingam 04/20/2009 9:23 PM
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neiroatopelcc :
Okay - so if you're right, I don't have to worry having to remove it in 6 months again. 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.



You don't read any license agreements ever, don't you?

neiroatopelcc 04/20/2009 9:29 PM
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zingam :
You don't read any license agreements ever, don't you?


Ofcourse I don't - but that's not the point really.
The point is, that if the openoffice owners change, they might foget how to support their software - like the rest of the opensource industry. And thus the management might reconsider and once again change their minds.

jsloan 04/20/2009 10:34 PM
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Blessedman :
I am just glad to see Oracle spend some of the mounds of cash they have been hording.



they are not like microsoft which is sitting on a pile of cache, in fact they actually don't have all that much cache, sure they have 11.29B, but they owe 11.24B! Now they do have a nice net profit 5.74B and good profit margins 24.29%

http://finance.yahoo.com/q/ks?s=ORCL

Microsoft has 20.30B in cash and only owes 2.00B, not that is nice pile of cash. Plus they have net provits of 17.23B and profit margin of 27.80%

http://finance.yahoo.com/q/ks?s=MSFT

what oracle has been doing of late is buying losers and has beens, large companies like Sun and BEA.

eddieroolz 04/20/2009 11:01 PM
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I don't exactly know what Oracle is, or what that company does, but all I know is that it's helping my virtual stock simulator's Sun shares to jump in price, and I'm happy! :)

neiroatopelcc 04/20/2009 11:05 PM
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eddieroolz :
I don't exactly know what Oracle is, or what that company does, but all I know is that it's helping my virtual stock simulator's Sun shares to jump in price, and I'm happy!


Oracle is a software developer primarily providing corporate level software. They're a bit like foxconn - if you're just a consumer, you won't know them.

p05esto 04/20/2009 11:30 PM
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JAVA and MySQL will be going bye-bye, that's my prediction. I like .NET?SQL much more anyhow, JAVA is ridiculously hard to learn in comparrision.

joeman42 04/20/2009 11:42 PM
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Regarding Open Office, nee Oracle Office, perhaps they can add a real db tool to that suite, the current module is an atrocity, a crime against technology!

Seriously, I think java and mysql are the crown jewels of the acquisition--not throwaways that everyone here seems to fretting about. Oracle has no low end db in its portfolio and mysql is the biggest in that space. If anything, I can see a greater integration and interoperability between the two; this could be a huge asset to customers.


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