Oracle Corp is being bailed out by Nippon Steel Corp, best known in the computer industry for being bes’ friends with Concurrent Computer Corp and for its Librex portable computer venture. The Japanese firm signed a letter of intent to put up $200m in total for an initial 49% of Oracle Japan – but Oracle’s stake in its presently 100%-owned Japanese unit could rise back to as much as 75% depending on the cash it generates. The $200m is met by $100m of 10-year convertible subordinated debentures paying 9% and convertible into Oracle common at $27.50 a share, maturing in 1999, 2000 and 2001, and $100m of 6% convertible preferred stock that if converted to common offers a maximum total return of 14%, convertible into common at the ruling price four years from now. The maximum of Oracle common Nippon Steel can end up with is 7.6%; it agreed not to buy more for at least 10 years.
