PeopleSoft completes JDE acquisition

Following the approval of the US Justice Department, PeopleSoft has completed the acquisition of JD Edwards. As of July 18, PeopleSoft had acquired 88% of JD Edwards’ shares, while those left outstanding should be transferred by the end of August.

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By  Matthew Southwell Published  July 23, 2003

|~||~||~|Following the approval of the US Justice Department, PeopleSoft has completed the acquisition of JD Edwards. As of July 18, PeopleSoft had acquired 88% of JD Edwards’ shares, while those left outstanding should be transferred by the end of August.

Through the acquisition, PeopleSoft will be able to expand its presence in more than 20 industries, including a broad range of services, manufacturing, distribution and asset intensive sectors.

For JD Edwards, the deal has leapfrogged it up the enterprise resource planning (ERP) vendor rankings and will enable it to approach the enterprise space with a more convincing software story. Combined, the companies boast approximately US$2.8 billion in annual revenues, 13,000 employees and more than 11,000 customers in 150 countries.

However, before the benefits of the merger materialise, the two vendors have to complete the integration of their respective organisations and cement PeopleSoft’s new position as the second largest enterprise software vendor on the planet.

“Now the deal is complete, integration teams from the two companies are looking at all the various facets, departments, the organisational structure and so on of both companies to come up with an integration plan that takes the best of both [PeopleSoft and JD Edwards],” says Trevor Salomon, marketing director of JD Edwards EMEA.

Although no timeframe has been released regarding the integration of the two firms, Salomon believes it will be a relatively quick process.

“Given that the merger happened more quickly than originally anticipated — two plus months earlier — you can bet your bottom dollar that the process will be as quick as possible, but not so quick as to be detrimental and mean that we need two or three goes at it,” he says.

“There are many people that will be impacted by this and everyone wants clarity, therefore we will do our level best to get it right first time around. As such, I can’t give a timeframe,” he adds.

In the Middle East, the human resources integration effort should be relatively simple as PeopleSoft lacks an enlarged local presence. Despite this, no further details have been made available. Graeme Slocombe, director of channels for EMEA at PeopleSoft, says things will become clearer once the integration teams have done their job.

“What happens in each region of the world is all part of this integration process and the Middle East will be looked at no differently from any other part of the world,” adds Salomon.

Just how the completion of the merger will impact on Oracle’s hostile takeover of PeopleSoft also remains unclear. Although the database vendor increased its cash tender offer to US$19.50 per share, or approximately US$6.3 billion, on the same day as PeopleSoft purchased JD Edwards’ shares, Oracle’s local office stated that no one was available for comment.

However, Torben Pedersen, IDC’s MENA software & services analyst, suggests Oracle’s actions are now irrelevant, as the takeover bid is out of its control.

“[Oracle] is still waiting for the regulatory authorities in the US to make up their minds as to whether this [bid] is a good idea or not. It has to go through the procedure before Oracle can ask the PeopleSoft shareholders to vote,” he says.

“If the antitrust people say that this [Oracle’s takeover bid] is a ‘go’ then they can do it… but it is up to the [PeopleSoft] shareholders whether they want to press the red or green button. It is out of Oracle’s hands,” he adds.

In the meantime, Salomon says both PeopleSoft and JD Edwards will ignore Oracle and focus on integrating the two vendors’ operations.

“It is pure speculation at this stage… Oracle has extended its offer to the end of August, but I can’t understand why. We are focused on the integration of the two organisations and the products. Whatever Oracle chooses to do they will do without our permission anyway,” he states.||**||

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