20 June--PeopleSoft goes ahead with JD Edwards exchange offer. (CRM News Review).
The move comes just one day after Oracle Corp upped its offer for PeopleSoft and launched a legal bid to prevent the JD Edwards acquisition going ahead before PeopleSoft shareholders had an opportunity to vote on Oracle's proposal.
Interested JD Edwards stockholders have between now and midnight US Eastern Time on July 17, to tender their shares. PeopleSoft is offering cash, common stock or a combination of both, with a value of $7.05 per share in cash plus the value of 0.43 of a PeopleSoft common share for each JD Edwards share.
The offer values JD Edwards at $14.33 per share, based on the $16.92 closing price of PeopleSoft stock on June 13, the trading day before the two companies' announcement of an amended deal. That amendment altered the deal from an all-stock offer valued at $1.7bn to a stock and part-cash alternative worth $1.75bn.
While PeopleSoft stockholders examine the offers to determine their best option, analyst Tad Piper with investment bank US Bancorp Piper Jaffray has said that he believes JD Edwards investors have an easier decision.
"I would say that most JD Edwards shareholders will run, not walk, to accept PeopleSoft's exchange offer," he said.
JD Edwards executives have impetus to see the deal closed too. The company revealed in a Securities and Exchange Commission filing that management is due substantial 'golden parachute' payouts if the merger goes through.
CEO Bob Dutkowsky, who will serve as a consultant for up to six months after the merger, will get $650,000 on the deal closing, and $1.95m at the end of the six-month transition period. The vesting date of his share options will be accelerated also.
CFO Richard Allen will stick around for six months and get $1.8m cash. Richard Snow, vice president and general counsel of the company, will get $456,248. JD Edwards said 47 other employees have entered into "substantially similar" arrangements. All will be bound by PeopleSoft non-compete agreements for a year.
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|Date:||Jun 24, 2003|
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