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March 10, 2005updated 19 Aug 2016 10:11am

Is Oracle in danger of over-extending itself?

No sooner has Oracle completed the PeopleSoft acquisition than it is off putting in a cash bid for Retek. Come on Larry, don't you think you should concentrate on doing at least a little bit of PeopleSoft integration before you go out shopping

By Jason Stamper Blog

No sooner has Oracle completed the PeopleSoft acquisition than it is off putting in a cash bid for Retek.  Come on Larry, don’t you think you should concentrate on doing at least a little bit of PeopleSoft integration before you go out shopping again?

SAP originally tabled its $496m offer for Minneapolis-based Retek at the end of February. Oracle, fresh from its PeopleSoft victory, officially launched a rival $9 cash per share bid – which is 50 cents more than SAP. The total value of Oracle’s deal would be approximately $515m.

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Retek specializes in applications for retailers. Oracle says that this is an under-penetrated market, that Oracle is a better home for Retek than SAP – both technologically and financially – and that SAP only got to make an offer because Oracle was distracted.

"We decided that we were going to make a bid, partially to defend our number one position in North American applications market," Larry Ellison, Oracle’s CEO said on a conference call. "We were a bit distracted with the PeopleSoft acquisition process when SAP decided to make their bid," Ellison said. The companies had been in talks since September, he said. "It’s been our intention for some time to acquire Retek, it was just a matter of timing."

Well yeah, but that’s my point: the timing really isn’t great, even now. The history books are littered with failed technology acquisitions, and perhaps Oracle needs to concentrate on the PeopleSoft integration if it is to get it right.

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