Oracle & Sun To Merge…

By Marc Handelman on April 20th, 2009

Oracle WOW

Om Malik [via his highly regarded GigaOm bloggery] has reported the apparent decision, over the weekend, by Oracle Corporation (NasdaqGS: ORCL) to merge with Sun Micrososystems Inc. (NasdaqGS: JAVA). The deal is estimated at over $7 Billion USD; of particular interest to us is the overlap with SUNs’ MySQL relational database and Oracles’ RDBMS… More information detailing the news appears after the jump.

From Om Malik’s GigaOm: “Oracle to Buy Sun (and MySQL) for $7.4B“

Updated: Less than a month after it walked away from a $7 billion deal with IBM, Sun Microsystems says that it has entered into a definitive merger agreement with database and enterprise software giant Oracle. Oracle will acquire Sun common stock for $9.50 per share in cash. The transaction is valued at approximately $7.4 billion, or $5.6 billion net of Sun’s cash and debt. It’s been approved by Sun’s board of directors.

Well if not IBM, someone was going to buy Sun, for the company was being actively shopped around to buyers. I thought Cisco should buy Sun, and so did 66 percent of 1,120 of our readers who took part in an online poll. At this price, it looks like Oracle found itself yet another bargain and in one fell swoop became a worthy competitor to IBM. It allows Oracle to become a player in the cloud computing business. More importantly, the company ends up acquiring MySQL, the upstart database that has been viewed as Oracle’s Achilles’ heel. In one fell swoop, it has taken out its No. 1 competitor. Oracle says that this acquisition is to be accretive to its earnings by at least 15 cents on a non-GAAP basis in the first full year after closing.The acquired business will contribute over $1.5 billion to Oracle’s non-GAAP operating profit in the first year, increasing to over $2 billion in the second year. “This would make the Sun acquisition more profitable in per-share contribution in the first year than we had planned for the acquisitions of BEA, PeopleSoft and Siebel combined,” said Oracle President Safra Catz in a statement.