Oracle
Oracle to square off with the DoJ again?

DoJ raises Oracle/Siebel anti-trust questions

Oracle/PeopleSoft all over again?

Tom Sanders in California

The US Department of Justice (DoJ) has requested additional information from Oracle about its planned acquisition of Siebel Systems as part of an anti-trust investigation into the deal.

The request is a strong reminder of the legal clash between Oracle and the DoJ last year over the database giant's purchase of PeopleSoft. A federal judge in San Francisco in the end ruled in favour of Oracle.

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"It sounds like a routine bureaucratic procedure that is normal in an acquisition of this type," said Paul Hamerman, a research director covering enterprise business applications at analyst firm Forrester Research

"I cannot imagine that the DoJ wants to take on Oracle in court after Oracle won convincingly in the PeopleSoft case," he told vnunet.com.

Oracle reached an agreement last month to acquire Siebel for $5.85bn. Chief executive Larry Ellison testified before a federal judge last year that his company had previously considered buying the CRM software vendor.

The Siebel acquisition would make Oracle the largest CRM software company. Oracle is in the process of beefing up its portfolio of enterprise applications, and increasing the pressure on German firm SAP in this market.

The $5.85bn deal would be the second largest acquisition by Oracle this year, after the company closed the $10.3bn PeopleSoft acquisition.

The DoJ had alleged that the PeopleSoft takeover would decrease competition in the field of high-function human resources and financial management software because it leaves only Oracle and SAP as major players.

Ellison, however, testified that he needed PeopleSoft to compete effectively with SAP, as well as to counter the looming threat from Microsoft.

After the judge approved Oracle's acquisition plans, the consensus was that the DoJ had been too narrow in its complaint by limiting it to high-function HR and financial management software.

In reality the enterprise application market is much broader, and a monopoly in that particular niche market would have given Oracle significant power to control the market unfairly.

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