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Oracle's BEA bid descends into farce
Multi-billion dollar offer is serious undervaluing of company, says BEA board...

By Reuters

Published: Monday 15 October 2007

Oracle and BEA Systems traded salvos over the series of events that led to Oracle's bid for the company.

Oracle, in a letter sent by president Charles Phillips to BEA's board of directors, said BEA cancelled a meeting scheduled for Friday and declined attempts to reschedule.

Oracle, which has made a $6.7bn offer to buy BEA, also said it remained "committed to its proposed price of $17 per share". BEA earlier on Friday rejected Oracle's bid, saying it seriously undervalued the company.

In the letter, Oracle contends BEA agreed to meet with Oracle on Friday morning and "intended to result in the execution of definitive agreements before the open of business on Monday, 15 October". Oracle said BEA cancelled that meeting late Thursday night.

According to the letter sent by Phillips: "Our proposed price is a substantial premium to an already-inflated price that reflected speculation of the potential sale of BEA."

Oracle also said it was prepared to go ahead immediately with a process that would lead to a friendly transaction.

BEA responded late on Friday by releasing a copy of a letter sent to Phillips by William Klein, a BEA representative.

According to the letter: "Dear Charles: Let me clarify your misunderstanding and set the record straight... We did not agree to meet this morning to commence a process, and we did not agree to your proposal that the process result in a definitive agreement by Monday."

Klein also reiterated BEA's position that the company is worth "substantially more" than the $17 per-share bid proposed by Oracle.