If iSeries users received a bit of a jolt last week when they heard that ERP vendor PeopleSoft Inc. intended to buy iSeries vendor J.D. Edwards & Co., then the news Friday that Oracle Corp. wanted to buy PeopleSoft must have sent them reeling.
However, Oracle's surprise takeover bid of PeopleSoft could jeopardize the ERP vendor's purchase of J.D. Edwards. Upshot: There may be nothing for iSeries users to be concerned about -- except maybe J.D. Edwards' stability.
On Monday, PeopleSoft announced its plans to acquire J.D. Edwards in a $1.7 billion stock deal. Ellison called that a "risky merger" and said Oracle's bid is "a much safer road for the PeopleSoft shareholder."
Oracle announced on Friday that it would attempt to buy PeopleSoft for about $5 billion.
Edwards' Chief Executive Robert Dutkowsky speaking on a conference call from a customer conference in Denver today said Oracle's hostile bid for PeopleSoft Inc., raises "serious antitrust issues." Dutkowsky added that Oracle's bid for PeopleSoft would be tied up for months with antitrust regulators and is likely to be blocked anyway because it would eliminate PeopleSoft as one of Oracle's biggest rivals.
Michael Doane, a vice president at Stamford, Conn.-based Meta Group, said it's unlikely Oracle would be interested in also acquiring J.D. Edwards.
"Oracle will probably reconsider the J.D. Edwards deal if they are successful in buying PeopleSoft," he said. "I would bet that the J.D. Edwards acquisition is cut out of the picture -- and that's good for customers." He added that it's ultimately better for J.D. Edwards and its customers if it keeps its current management team in place.
It's still too early to say how such corporate shifting will affect iSeries users, however. At least one iSeries pro doesn't like what he sees. "Acquisitions like this are usually bad things for the iSeries," said John Brandt, vice president of technical services at iStudio400.com.
If Oracle gets J.D. Edwards, it wouldn't bode well for IBM either, Brandt said. Nothing would keep Oracle from moving front-end J.D. Edwards products over to the Oracle database, thus squeezing out DB2 on the iSeries, he said.
"IBM has taken DB2 on the iSeries for granted. They have for a long time," Brandt said.
In many ways, the proposed J.D. Edwards/PeopleSoft merger seems a good fit, observers said. The former is strong in the manufacturing space, particularly with iSeries applications. PeopleSoft, by contrast, is strong in the services industries. In other words, their product lines complement each other, without a lot of redundancies.
Moreover, Bob Dutkowsky, J.D. Edwards' CEO, said last week that he expected PeopleSoft to continue to support the company's iSeries products -- if the deal goes through -- because iSeries products represent a valuable part of the company's business.
FOR MORE INFORMATIONPoll:Which PeopleSoft/J.D.Edwards/Oracle scenario do you prefer Oracle launches takeover bid for PeopleSoft PeopleSoft to acquire J.D. Edwards