Oracle Buys Sun for $7.4 Billion

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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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Jane McEntegart
35 Comments Comment from the forums
  • LuxZg
    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..
    Reply
  • 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 :)
    Reply
  • JMcEntegart
    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. :)
    Reply
  • neiroatopelcc
    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 ...
    Reply
  • reddragon72
    if this is the fact then Google, MS, and Yahoo and all other search engines should be found guilty cause we all know that you can punch in the name of the program/music/movie that you are looking for and add the word torrent to it and find it. so in essence they are all guilty for leading you to the end copywrited material.
    Reply
  • kyeana
    ^i think you got the wrong thread :P
    Reply
  • tenor77
    Maybe they could invest some money into making their database a little more stable. I swear mines down once a week.
    Reply
  • 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?
    Reply
  • 7amood
    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.
    Reply
  • fonzy
    Is there anyway to disable that fucking Dell ad that pops up every time I visit this site.
    Reply