An amended merger

PeopleSoft and J.D. Edwards & Company have amended their definitive agreement under which PeopleSoft will acquire J.D. Edwards. The amended agreement is designed to allow the two companies to accelerate the completion of the transaction, bring forward the benefits of their combination and increase the accretion to earnings per share for PeopleSoft stockholders.

The move comes hard on the heels of the news that PeopleSoft is to sue Oracle Corporation to put an end to what it characterises as that company’s ‘sham tender offer’ aimed at destroying PeopleSoft’s business.

Based upon the closing price of PeopleSoft common stock on June 13, 2003 of $16.92 per share, the consideration for each outstanding share of J.D. Edwards common stock would be $14.33, for a total transaction value of approximately $1.75 billion. The consideration will be paid in the form of $863 million in cash and 52.6 million newly issued PeopleSoft shares, based on J.D. Edwards 122.4 million shares outstanding. Each J.D. Edwards stockholder will have the right to elect either cash or PeopleSoft common stock, subject to proration.

The transaction is expected to be significantly accretive to PeopleSoft’s 2004 earnings per share on an adjusted basis, excluding amortisation associated with acquired intangibles, the write-down of deferred revenue and other purchase accounting adjustments. The transaction is expected to close in the third calendar quarter of 2003.

The cash portion of the consideration increases the certainty of the value of the transaction to J.D. Edwards stockholders and, at the same time, increases the accretion to PeopleSoft’s earnings per share for the benefit of all stockholders.

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