BEA rejects $6.7b Oracle offer saying it is too low

Business software maker BEA Systems Inc rejected a $6.7 billion takeover bid from Oracle Corp on Friday, throwing the company into play by saying the unsolicited offer was too low.

Shares rose 38 per cent, above a five-year high, and activist investor Carl Icahn, BEA's biggest shareholder and a vocal critic of management, said he was pleased by Oracle's offer but called for higher bids.

Shares of BEA, which makes software that helps other programs interact, rose to $18.82, nearly $2 above Oracle's $17 offer that was made on October 9 but not disclosed until Friday.

"BEA is worth substantially more," the company's board said in a letter to Oracle.

Oracle said it remained "committed" to its proposed $17 per share offer and was ready to proceed with a "friendly" transaction.

But in a sign of acrimony between the two sides, BEA took issue with a letter to BEA from Oracle President Charles Phillips, which was made public.

In the letter, Phillips said BEA had cancelled a Friday meeting that was intended to result in a deal by tomorrow and declined attempts to reschedule.

"Let me clarify your misunderstanding," William Klein, BEA's vice president of business planning and development, said in a response to Phillips.

He said that, contrary to Phillips's assertion, BEA did not agree to meet with Oracle to start a process that might result in a definitive agreement by tomorrow.

Icahn, who said in mid-August he had a stake in BEA, said he expected higher offers to emerge from rivals of Oracle, naming International Business Machines Corp and Hewlett-Packard Co.

In a letter to BEA CEO Alfred Chuang on Friday Icahn suggested an auction as one way to proceed.

IBM spokesman Ian Colley said the company does not comment on rumours or speculation. Officials with Hewlett-Packard could not be reached for comment.

The industry has been consolidating over the past few years with Oracle, IBM and Hewlett-Packard among the most aggressive buyers.

Icahn has said BEA should be put up for sale because being part of a bigger software maker would allow it to squeeze significant costs out of BEA's operations.

Katherine Egbert, an analyst with Jefferies & Co, said BEA was probably worth about $18 per share at the most and that its operating margins could double if Oracle bought it.

"They could probably fire everybody except the engineers," she said. She estimates that the company's current operating profit margin is about 22 per cent to 23 per cent.

BEA has not reported its operating profit margin since July 2006. The company has only released limited financial data since then as it reviews historical results for what it said were errors in its accounting of stock options grants. That led potential buyers to underestimate its value, it said.

BEA sells software called "middleware" that helps computer systems communicate with each other.

Some investors have bet Icahn would fail to engineer a sale.

About 21.6 million BEA shares, or 5.5 per cent of the company's outstanding shares, were sold short as of the end of September, nearly a 65 per cent increase from the middle of the month. People sell a stock short betting that the share price will fall. ( Reuters )

Subscribe to Trend in Google News! Subscribe
Azerbaijan records growth in loan portfolio of local banks in 9M2021
Azerbaijan records growth in loan portfolio of local banks in 9M2021
Azerbaijan, Singapore to co-op in construction of geostationary satellites
Azerbaijan, Singapore to co-op in construction of geostationary satellites
Weekly review of Azerbaijani precious metals market
Weekly review of Azerbaijani precious metals market
Loading Bars
Saudi Arabia targets net zero emissions by 2060
Russia registers an all-time high of 37,678 coronavirus cases in past day
Uzbekistan eyes foreign technology for better local polymer production
Turkmen delegation to pay working visit to Iran
Azerbaijan records growth in loan portfolio of local banks in 9M2021
Turkmenistan’s Turkmenbashi refinery eyes producing hydrogen
Azerbaijan, Singapore to co-op in construction of geostationary satellites
IRICA shares data on Iran's trade turnover with SCO member states
Iran sees increase in exports of non-oil products from Hormozgan Province
Weekly review of Azerbaijani precious metals market
Kazakhstan unveils trade indicators with its TOP-3 EU partners
Turkmenistan approves new procedure for allocating investments from Stabilization Fund
Azerbaijani MoD observes exercises in liberated Lachin district (VIDEO)
Russian Health Ministry greenlights joint COVID-19 and flu vaccination
Central Bank discloses volume of loans issued to Azerbaijan's districts
Georgia records surge in tourist visits from Uzbekistan
Tourist inflow from Kazakhstan to Georgia soars
Iran boosts exports through customs of Zanjan Province
Azerbaijan notes decrease in banking sector' profit
Azerbaijan sees rise in mortgage lending
Iranian currency rates for October 23
Weekly review of Azerbaijani currency market
Georgia releases data on COVID-19 cases for October 23
New customs post in Azerbaijan to speed up cargo movement along North-South corridor (PHOTO)
Azerbaijan, Armenia to sign new documents in Moscow
Azerbaijani oil prices increase
Georgia sees decrease in tourist inflow from Azerbaijan
Turkmen company to purchase material, technical resources via tender
Kazakh energy company opens tender to buy metal corners
Kazakh oil company opens tender to buy spares
Kazakh KazMunayTeniz opens tender for Caterpillar equipment maintenance
Azerbaijan's Central Bank unveils data on currency exchange operations for Jan. through Sept. 2021
Azerbaijani fund presents concept for restoration of liberated territories
EDB purchases bonds of Kazakh KEGOC JSC
US corporate workers to start returning to offices next month
Iran changes pricing of petrochemical products at its mercantile exchange
Iran's foreign exchange needs trigger to expand exports
Surge of energy prices puts Europeans in stalemate (VIDEO)
Chinese company opens massive eco-friendly mine in Serbia
Kazakhstan’s daily COVID-19 case count stands at 1,732
Georgian honey exports skyrocket, following COVID-ravaged year
Iranian envoy, head of Georgia's State Security Service meet
Turkey announces commissioning date for logistics center in Sivas (Exclusive)
US military eliminates one of Al-Qaeda leaders in northwest Syria
Mutation of Delta variant may be more transmissible: UK health agency
Biden, Macron discuss cooperation, to meet in Rome late October
India, UK working on free trade agreement: Harsh Vardhan Shringla at India Global Forum
Turkey reports 28,192 daily COVID-19 cases
G7 countries reach breakthrough on digital trade and data
India perhaps only G20 country to fulfil...: India ahead of COP26 climate summit
U.N. plane aborts landing as air strike hits Ethiopia's Tigray
Relations with India stronger than ever, says Maldives Defence Minister
Chronicles of Victory: October 23, 2020
Iranian delegation leaves for Tashkent to observe elections
UK PM Johnson says fresh COVID lockdown not on the cards
2 soldiers, terrorist killed in northwestern Pakistan's clash
Pfizer/BioNTech COVID-19 vaccine shows 90.7% efficacy in trial in children
Belarus, Kazakhstan discuss joint efforts to maintain regional security
Georgia, Turkey to set up joint air force plant
TURKIC.World project presented at media forum of Turkic Council (PHOTO)
Iran boosts transit via TRACECA corridor
French court annuls "treaty" with illegal Armenian regime in Azerbaijan's Karabakh
Azerbaijan's MoD inspects combat positions in liberated Kalbajar, Lachin districts (PHOTO)
Uzbekistan Airways opens tender related to local fire alarm system
Iran looks to enhance road development in Ardabil province
Main countries of origin for tourists arriving in Georgia
Spanish Gedepsa interested in growing olive plantations in Uzbekistan
Azerbaijan reveals number of mines, munitions found on its liberated lands (PHOTO)
Overview of Uzbekistan's retail trade turnover dynamics between 2010-2020
When Karabakh road infrastructure to be fully ready?
Armenians propagate Nazi Nzhdeh and accuse Azerbaijan of racism (VIDEO)
Relations With India Stronger Than Ever, Says Maldives Defence Minister
Bennett-Putin meeting lasted five hours, was warm and positive
Azerbaijan shares data on number of vaccinated citizens
Azerbaijan confirms 2,112 more COVID-19 cases, 882 recoveries
Australia says EU has postponed free trade talks for second time
Azerbaijan’s volume of non-cash payments continues to grow
Delta Galil files for Nasdaq offering
Azerbaijan's investment attractiveness increased after liberation of its lands - minister (PHOTO)
Turkmenistan reduces wheat imports from EAEU states
Azerbaijan’s wheat imports from EAEU countries revealed
Belarusian company to supply Azerbaijan with cables
Azerbaijan sees growth in its population's bank deposits
Azerbaijan commissions recently built military facilities in its liberated lands (PHOTO/VIDEO)
Non-tourist trips to Georgia plummet
Kazakh Tengizсhevroil to reduce LPG supplies to Ukraine after polypropylene plant's launch
Iran to use domestic capacity for road fleet modernization
Azercell once again bestowed with ISO 37001:2016 Anti-bribery Management Systems standard of compliance
Azerbaijan reveals data on mine clearance work carried out in liberated lands
Azerbaijan’s cargo transportation by all types of transport decreases in 9M2021
Ukrainian companies interested in entering Turkmen market
EBRD, EU to provide loans for indirect financing of green technologies in Georgia
SOCAR-AQS exceeds drilling progress plan
President Ilham Aliyev sends congratulatory letter to Hungarian counterpart
Azerbaijan to expand co-op with Turkey in mine clearance – ANAMA
Uzbekistan signs agreement to put out former uranium mining sites
Iran eyes developing non-oil exports
India hopes to work with China for resolution of issues: Shringla
Azerbaijan’s Bulla Deniz produces over 54,000 tons of oil with technical measures
UK foreign secretary begins India visit today, to hold talks with Jaishankar
All news