Oracle says $9.3B bid for NetSuite is its ‘final offer’
Oracle Corp. Chief Executive Mark Hurd has said that the company’s $9.3 billion bid to acquire NetSuite Inc. is its final offer, even as NetSuite investors agitate for more.
Hurd told CNBC in an interview that Oracle has set a deadline of this Friday, Nov. 4, for NetSuite shareholders to accept its offer, saying that the company is ready to walk if the bid is rejected.
“It’s done from our perspective,” Hurd said when asked about the deal. “It’s our best and final offer.”
But if Oracle is unwilling to budge on its offer, that refusal could well derail the deal, which was first announced back in July. The problem is that investment firm T. Rowe Price, NetSuite’s largest independent shareholder, is agitating for $2 billion more to be thrown on top of the offer before it supports the deal. Currently, Oracle is offering $109 per share, which is a 10 percent premium on the company’s stock price, but T. Rowe Price officials say they want Oracle to up that offer to $133 a share, Bloomberg reported.
T. Rowe Price reportedly told Oracle last month that it was planning to oppose the buyout, and that left Oracle with just 22 percent of the shares it needs to close the deal, forcing it to extend the deadline to Nov. 4. However, Oracle’s Hurd told CNBC that his company wouldn’t be held hostage, and is ready to move on should NetSuite’s investors spike the deal, which has already been agreed to by both companies’ boards of directors.
“We’ll move onto other things,” Hurd said. “We’re going to move onto executing our strategy. … We’ll abide to what the shareholders say.”
Oracle said at the time it announced the deal that it sees NetSuite, with its considerable software-as-a-service capabilities, as an important addition as it builds out its growing cloud. In addition, NetSuite would’ve given Oracle more clout in the midmarket space, where NetSuite has a significant presence.
Oracle has been particularly vocal about its cloud ambitions of late, aggressively building out its capabilities in SaaS and platform-as-a-service as it sets leader Amazon Web Services in its sights. Earlier this month, Oracle made available its Bare Metal Cloud Services offering, which is aimed at boosting its presence in the infrastructure-as-a-service segment.
NetSuite could boost Oracle’s cloud growth further, but Hurd said that even if the deal doesn’t go through, he’s already pretty comfortable with how it’s growing.
“Our growth rate is pretty high, driven a lot by apps and by platforms, so we’re really happy with our growth in the cloud,” he said.
Photo Credit: Peter Kaminski Flickr via Compfight cc
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